Zimbabweans Begin Paying 15% Digital Services Withholding Tax

Zimbabwe has begun implementing a 15% digital services withholding tax on payments to foreign-based platforms (image source)

HARARE — Zimbabweans using foreign-based digital platforms have begun paying a 15 percent Digital Services Withholding Tax following the enactment of a new tax regime designed to bring income earned by non-resident digital companies into the country’s tax net.

The levy, introduced through the Finance Act signed into law last week, applies to payments made for offshore digital services provided by companies with no physical presence in Zimbabwe. These include subscription streaming services, e-hailing platforms, satellite internet providers and other online-based services. The tax is withheld at source by banks, mobile money operators and other regulated financial intermediaries at the point of payment, before being remitted to the Zimbabwe Revenue Authority (Zimra).

Presenting the 2026 National Budget, Finance Minister Professor Mthuli Ncube said the measure seeks to address revenue leakages arising from the rapid growth of the digital economy. He told Parliament that offshore platforms were generating substantial income from Zimbabwean consumers without contributing to domestic tax revenues. “The current tax framework does not adequately capture income accruing to non-resident digital service providers, resulting in significant revenue losses,” he said.

The withholding tax covers a broad range of digital services, including streaming subscriptions, e-hailing fees, digital advertising, e-commerce transactions, online commissions, cloud computing services and satellite-based internet access. Financial intermediaries facilitating payments to foreign-domiciled providers are required to remit the withheld tax to Zimra within 30 days.

Under the law, failure to withhold or remit the tax may result in penalties, including liability for the unpaid amount and a 15 percent surcharge. However, Zimra retains discretion to waive penalties in cases where there is no evidence of deliberate tax evasion. Intermediaries are also required to issue certificates to payers detailing the gross amount paid to offshore service providers and the tax withheld.

The move comes as Zimbabweans increasingly rely on digital services, spending millions of dollars annually on platforms such as Netflix, e-hailing applications like InDrive, digital advertising through Google and Meta, e-commerce platforms, online gaming services and satellite internet providers including Starlink.

Tax analysts say the new levy is intended to safeguard Zimbabwe’s taxing rights and promote fairness in the market by ensuring offshore digital companies contribute to the fiscus in the same way as locally based service providers.