Paying taxes

Having remained fairly stable for the period from 2004 to 2012, Zambia’s performance on the Paying Taxes sub-indicators has recently seen significant changes.

Total Tax Rate

The Total Tax Rate has increased from 15.5% in 2013 to 18.6% in 2014. Despite the increase, Zambia still has one of the lowest Total Tax Rate in Africa.

The low Total Tax Rate is largely attributable to a more favourable tax treatment afforded to the manufacturing and agricultural sectors. For instance, unlike other industry sectors, entities operating in the manufacturing and agricultural sectors can claim capital allowances at a rate of 50% on a straight line basis on the cost of plant or machinery purchased, as is the case for our case study company.