VALUE ADDED TAX ACT: SUBSIDIARY LEGISLATION (CHAPTER 331 )

(1) Subject to this Regulation, a registered supplier referred to in sub-section (1) of section 54 of the Act may claim, as input tax, a credit or deduction in respect of the tax on goods referred to that sub-section.

(2) No claim under this regulation shall be allowed unless—

(a) the registered supplier has paid the supplier of the goods for them;

(b) the registered supplier has lodged all sales tax returns and paid to the Commissioner-General all sales tax or other money due in respect of those returns or otherwise arising under the repealed Act;

(c) the tax return by which the claim is made is supported by a Schedule of all goods to which the claim relates, and specifying, in relation to each consignment—

(i) the quantity, description and value of the goods;

(ii) the number and date of the purchase invoice or customs bill of entry;

(iii) the name and address of the supplier of the goods;

(iv) the sales tax paid.

4. Relief from tax in respect of certain imported goods

(1) Subject to this regulation, a taxable supplier may claim, as input tax, a credit or deduction in respect of the tax on goods imported on or after 1st May, 1995.

(2) No claim under this regulation shall be allowed unless—

(a) the taxable supplier has paid the supplier of the goods for them;

(b) the taxable supplier has lodged any sales tax returns due under the repealed Act and paid to the Commissioner-General all sales tax or other money due in respect of those returns or otherwise arising under the repealed Act;

(c) the tax return by which the claim is made is supported by a Schedule of all goods to which the claim relates, and specifying, in relation to each consignment—

(i) the quantity, description and value of the goods;

(ii) the number and date of the purchase invoice and the customs bill of entry;

(iii) the name and address of the supplier of the goods;

(iv) the sales tax paid.

5. General limitations

(1) No claim under these Regulations shall be allowed unless the claim is made by the return relating to the registered supplier’s first prescribed accounting period.

(2) A claim under these Regulations shall be allowed only to the extent and subject to the conditions prescribed by or under section 18 of the Act in relation to input tax generally.

(3) Without limiting the generally of sub-regulation (2)—

(a) where the supplier is not in possession of documentary evidence as prescribed for the purposes of sub-section (3) of that section, the claim shall be disallowed; and

(b) a claim may be partly disallowed by rules of apportionment prescribed under that section and applying to the supplier’s business.

(4) No claim under these Regulations shall be allowed in respect of goods in respect of which a drawback or other relief under the repealed Act has been claimed and allowed.

(5) A claim cannot be made under regulations three and regulation four in respect of the same goods.

VALUE ADDED TAX (FIRST REGISTRATION) ORDER

[Section 53]

[Re-denominate the currency as stipulated under S 4 of Re-denomination Act, 8 of 2012, read with Bank of Zambia Act, 43 of 1996.]

Arrangement of Paragraphs

Paragraph

1. Title

2. Taxable turnover requiring registration

SI 60 of 1995.

[Order by the Minister]

1. Title

This Order may be cited as the Value Added Tax (First Registration) Order.

2. Taxable turnover requiring registration

(1) In this Order—

"relevant quarter" means any period of three consecutive months commencing—

(a) on 1st May, 1994; or

(b) on the first day of any subsequent calendar month;

"relevant year" means any period of 12 months commencing—

(a) on 1st May, 1994; or

(b) on the first day of subsequent calendar month.

(2) For the purposes of sub-section (3) section 53 of the Act, the prescribed turnover shall be calculated by reference to the taxable turnover of the business concerned during any relevant year and, if necessary, during each relevant quarter.

(3) Where, as at 1st May, 1995, the taxable turnover of a business exceeds or is likely to exceed—

(a) thirty million kwacha in any relevant year; or

(b) seven million five hundred thousand kwacha in any relevant quarter;

the business shall be taken to exceed prescribed turnover for the purposes of sub-section (3) of section 53 of the Act, and, subject to the provisions of that section, the person carrying on the business shall be registered by the Commissioner-General accordingly.

(4) In calculating, for the purposes of this Order, that part of the turnover of a business that is attributable to taxable supplies, supplies made in the course of the business before the tax commencement day shall be regarded as taxable if they would have been taxable had they been made after that day.

VALUE ADDED TAX (APPEALS TRIBUNAL) REGULATIONS

[Section 30]

Arrangement of Regulations

Regulation

PART I
PRELIMINARY

1. Title

2. Interpretation

PART II
MEMBERSHIP OF THE TRIBUNAL

3. Qualifications

PART III
ADMINISTRATION

4. Functions of Registrar

PART IV
PROCEEDINGS OF THE TRIBUNAL

5. Quorum

6. Appeal to be in writing

7. Acknowledgement appeal

8. Commissioner’s statement of case

9. Amendment

10. Documents

11. Withdrawal of an appeal

12. Power to extend time limit

13. Hearing

14. Witnesses

PART V
COSTS

15. Costs

PART VI
DECISIONS

16. Pronouncement of decisions

17. Appeals to High Court

[Regulations by the Minister]

SI 169 of 1995.

PART I
PRELIMINARY

1. Title

These Regulations may be cited as the Value Added Tax (Appeals Tribunal) Regulations.

2. Interpretation

In these Regulations, unless the context otherwise requires—

"deputy member" means a deputy member appointed under section (4) of section 30 of the Act;

"member" means a member appointed under sub-section (1) of section 30 of the Act;

"Registrar" means the Registrar referred to in sub-section (5) of section 30 of the Act.

PART II
MEMBERSHIP OF THE TRIBUNAL

3. Qualifications

A member or deputy member shall have the following qualifications—

(a) he must be a citizen of Zambia; and

(b) he must be under the age of 65 years:

Provided that a member shall not be qualified for appointment as Chairman or Deputy Chairman unless the member is a legal practitioner who has practised in Zambia for at least five years.

PART III
ADMINISTRATION

4. Functions of Registrar

(1) The Registrar shall be responsible, under the direction of the Chairman, for the effective and efficient provision of such administrative support as may be necessary to enable the Tribunal to carry out its functions, including the management and organisation of support procedures and support staff, the provision of suitable accommodation and other facilities required for sittings of the Tribunal.

(2) Without limiting the generality of sub-regulation (1), the Registrar shall be responsible for ensuring—

(a) that notices, summons, or other documents are served not less than seven days before the date of hearing;

(b) that the requirements of sub-section (2) of section 31 of the Act are met in relation to an appeal, subject to any decision by the Tribunal under sub-section (3) of that section;

(d) that the decisions of the Tribunal are sent to parties to an appeal, and published in the Gazette within a period of 14 days from the date the decision was made.

(3) The Registrar may, subject to the consent of the Chairman, delegate such of his functions as he thinks fit to any member of the staff of the Tribunal.

PART IV
PROCEEDINGS OF THE TRIBUNAL

5. Quorum

(1) Appeals shall be heard by the three persons being members or deputy members sitting together.

(2) The Chairman, or in his absence the Deputy Chairman shall preside over the sittings of the Tribunal.

(3) The determination of any matter before the Tribunal shall be according to the opinion of the majority of the members of the Tribunal considering or hearing the appeal.

(4) A member shall not sit or act as a member of the Tribunal if he has any interest, direct or indirect, personal or pecuniary, in any matter before the Tribunal.

6. Appeal to be in writing

(1) An appeal to the Tribunal shall be made in writing and shall provide—

(a) details of the decision against which the appeal is made;

(b) the date of the decision;

(d) the grounds for appeal; and

(e) such other information as the Tribunal shall prescribe.

(2) An appeal shall be lodged with the Tribunal within 30 days from the date of the decision or determination by the Commissioner-General.

7. Acknowledgement appeal

(1) Subject to sub-regulation (2) the Registrar shall acknowledge receipt of the appeal, in writing, and copy all documents to the Commissioner-General, within seven days of receipt thereof.

(2) If the appeal is lodged after expiry of the time limit prescribed in regulation 7, or if the appeal does not lie with the Tribunal, the Registrar shall so advise the appellant, copying the correspondence and documents to the Commissioner-General, within seven days of receipt thereof.

8. Commissioner’s statement of case

(1) The Commissioner-General shall, within 30 days of receipt of appeal documents under sub-regulation (1) of regulation 8, lodge with the Tribunal a written statement of the cases setting out the facts and reasons for the disputed decision.

(2) The Registrar shall acknowledge receipt of the statement of the case and copy all documents to the appellant, within seven days of receipt thereof.

9. Amendment

The Tribunal may at any time direct that the statement of the case, or other document relevant to the appeal proceedings be amended in such terms as they think fit.

10. Documents

(1) A party to an appeal shall within 30 days lodge with the Tribunal a list of all documents the party proposes to produce at the hearing.

(2) The Registrar shall acknowledge receipt of the list and shall send a copy to the other party within seven days of receipt thereof.

(3) The Tribunal may require any person who it believes has in that person’s possession documents which may assist the Tribunal in its deliberations, to produce those documents.

11. Withdrawal of an appeal

(1) An appellant may withdraw an appeal or the Commissioner-General may withdraw the decision against which the appellant is appealing any time before or during the hearing, in writing, and the Registrar shall send a copy of the withdrawal and any other documents to the other party within seven days of receipt of such withdrawal.

(2) Withdrawal of an appeal or decision shall not prevent a party from applying for costs.

12. Power to extend time limit

The Tribunal may, on application by a party to an appeal, extend the time limit prescribed for lodging an appeal for a period of 21 days.

13. Hearing

(1) The Registrar shall advise all parties to an appeal, in writing, of the time and place of the hearing, and shall give the parties not less than 14 days' notice.

(2) A hearing shall be in public unless, on application by a party to the appeal, the Tribunal directs that the appeal, or part of it, shall be heard in camera.

(3) An appellant may appear in person at a hearing or be represented by any person that person may appoint, and the Commissioner-General may be represented by any person the Commissioner-General may appoint for the purpose.

(4) If a party to an appeal or that party’s representative falls to appear at the hearing the Tribunal shall proceed in the manner it thinks fit.

14. Witnesses

(1) The Tribunal may call any person to attend a hearing and give evidence if the Tribunal believes that evidence will assist its deliberations.

(2) A witness attending a Tribunal hearing shall be paid allowances and expenses at the rates specified by the Registrar.

(3) Any person who—

(a) being required to attend the proceedings in the manner provided in this Part, falls without reasonable excuse, to attend;

(b) being summoned to produce any document, book or paper, in that person’s possession or under that person’s control, falls to produce the same; and

shall be guilty of an offence and liable to a fine not exceeding one thousand penalty units.

PART V
COSTS

15. Costs

(1) The Tribunal may award such costs as it considers appropriate to a party to an appeal to be paid to the other party within such period as the Tribunal may prescribe.

(2) The Registrar shall be the taxing officer for the purpose of taxing any costs relating to an appeal.

(3) An appeal against taxation of costs ordered by the Registrar shall be heard by the Chairman or Deputy Chairman sitting alone or with another member or deputy member of the Tribunal.

PART VI
DECISIONS

16. Pronouncement of decisions

(1) The Tribunal may deliver its decision at the end of a hearing, but in any case the decision shall be put in writing and sent to all parties to the appeal within 14 days of delivering the decisions.

(2) The Registrar shall keep copies of all decisions endorsed with date of issue to all parties.

(3) The Registrar shall publish the decision of the Tribunal in the Gazette within 14 days of the decision being delivered.

17. Appeals to High Court

Any party aggrieved with any award, declaration or decision of the Tribunal may appeal to the High Court.

VALUE ADDED TAX (SUPPLY) REGULATIONS

[Section 2]

Arrangement of Regulations

Regulation

1. Title

2. Supply of services

3. Supply of goods

4. Supply declared not to be a supply

FIRST SCHEDULE

SECOND SCHEDULE

THIRD SCHEDULE

SI 23 of 1996.

1. Title

These Regulations may be cited as the Value Added Tax (Supply) Regulations*.

2. Supply of services

A supply referred to in the First Schedule shall be a supply of a service for the purposes of the Act.

3. Supply of goods

A supply referred to in the Second Schedule shall be a supply of goods for the purposes of the Act.

4. Supply declared not to be a supply

A supply referred to in the Third Schedule shall not be a supply of goods for the purposes of the Act.

FIRST SCHEDULE

[Regulation 2]

Anything done for a monetary consideration which is not a supply of goods.

SECOND SCHEDULE

[Regulation 3]

The supply or importation of electricity.

THIRD SCHEDULE

[Regulation 4]

The transfer of ownership of imported goods in a Customs Bonded Warehouse in respect of which tax has not become payable under paragraph (b) of sub-section (1) of section 8 of the Act.

VALUE ADDED TAX (BAD DEBT RELIEF) REGULATIONS

[Section 51]

Arrangement of Regulations

Regulation

1. Title

2. Eligibility for relief

3. Claims

4. Records and accounts

5. Subsequent receipt of payment

SI 24 of 1996.

1. Title

These Regulations may be cited as the Value Added Tax (Bad Debt Relief) Regulations.*

2. Eligibility for relief

Where a registered supplier has supplied goods or services for a consideration in money, and has paid the full tax on the supply to the Commissioner general, but has not within 18 months after the supply received payment, in whole or in part, from the person to whom the goods are supplied, the registered supplier may seek a refund of that portion of the tax paid for which he has not received payment:

Provided that—

(a) in the case of a corporate body, an order of liquidation has been made; or

(b) in the vase of a person or partnership, an order in bankruptcy has been made in respect of the person or all the partners.

3. Claims

A refund under regulation 2 shall be claimed on a form approved by the Commissioner-General, where such evidence of eligibility as the Commissioner-General may require has been provided, and the such claim may be taken as input tax upon authorisation by the Commissioner-General.

4. Records and accounts

(1) All records, accounts, and correspondence in respect of the debts shall be retained for the time prescribed in sub-section (1) of section 42 of the Act or for two years after the date of the claim, whichever is the later.

(2) A registered supplier who fails to keep the records for the time required shall be subject to the provisions of sub-section (2) of section 42 of the Act.

5. Subsequent receipt of payment

(1) If a refund is taken and the registered supplier later receives payment, in whole or in part, in respect of the debt he shall remit to the Commissioner-General, on his next tax return, a sum equal to the portion of the payment that represents tax.

(2) A registered supplier who fails to remit the tax on his next return shall be guilty of offence and shall be liable on conviction to a fine not exceeding ten thousand penalty units.

VALUE ADDED TAX (EXEMPTION) ORDER, 1996

[Section 15]

[Re-denominate the currency as stipulated under S 4 of Re-denomination Act, 8 of 2012, read with Bank of Zambia Act, 43 of 1996.]

Arrangement of Paragraphs

Paragraph

1. Title

2. Interpretation

3. Revocation and replacement of First Schedule to Act

4. Revocation of statutory instruments

APPENDIX

SI 110 of 1996,

SI 16 of 1997,

SI 15 of 1998,

SI 15 of 1999,

SI 11 of 2000,

SI 12 of 2001,

SI 12 of 2002,

SI 37 of 2002,

SI 11 of 2003,

SI 14 of 2004,

SI 11 of 2005,

SI 39 of 2005,

SI 43 of 2006,

SI 22 of 2007,

SI 66 of 2007,

SI 12 of 2008,

SI 25 of 2009,

SI 56 of 2009,

SI 79 of 2009.

1. Title

This Order may be cited as the Value Added Tax (Exemption) Order.

2. Interpretation

In this Order, unless context otherwise requires—

"eligible goods" means those goods not previously imported as certified by the Director-General of the Investment Centre and such certification is accepted by the Commissioner-General of the Zambia Revenue Authority.

3. Revocation and replacement of First Schedule to Act

The First Schedule to the Act is hereby revoked and the First Schedule set out in Part I of the Appendix to this Order is substituted therefore.

4. Revocation of statutory instruments

The Statutory Instrument listed in Part II of the Appendix to this Order are hereby revoked.

APPENDIX

[Paragraphs 3 and 4]

PART I

FIRST SCHEDULE

[Section 15]

EXEMPT SUPPLIES AND IMPORTS

1. Water supply services

The supply of mains water and sewerage services, excluding sewerage pump out services.

2. Health supplies

(a) The supply of health and medical services by a registered medical practitioner, optician, dentist, hospital or clinic.

(b) Articles designed for use by the blind or disable.

3. Educational supplies

(a) Educational services provided to primary or secondary students.

(b) Education services provided to posts secondary students.

[First Sch item 3(b) subs by para 2 of SI 25 of 2009.]

[First Sch item 3(c) ins by para 2(a) of SI 15 of 1999.]

4. Books and newspapers

(a) Booklets, maps and charts; and

(b) Newspapers and journals.

[First Sch item 4 subs by para 2(a) of SI 12 of 2008.]

5. Transport services

(a) Transportation of persons by road in a bus or coach licensed under the Roads and Road Traffic Act and having a seating capacity for 14 or more adult persons.

(b) Transportation of persons by air.

[First Sch item 5(b) subs by para 2(b)(i) of SI 15 of 1999.]

(d) Transportation of persons by boat.

[First Sch item 5(d) subs by para 2 of SI 11 of 2000.]

(e) Aircraft licensed to carry passengers.

[First Sch item 5(e) subs by para 2(b)(ii) of SI 15 of 1999.]

6. Conveyance, etc. of real property

(a) The sale, lease or rental of an interest in land other than the sale, lease or rental of a commercial property.

[First Sch item 6(a) subs by para 2(a) of SI 79 of 2009.]

(b) The sale or lease of domestic buildings.

7. Financial and insurance services

(a) the arrangement, provision or transfer of ownership of any contract of insurance or re-insurance;

[First Sch item 7(a) subs by para 2(a)(i) of SI 14 of 2004.]

(b) the provision of the following financial paragraph—

(i) commission on certified vouchers;

(ii) manager's or banker's cheques;

(iii) up country cheques;

(iv) returned cheques

(v) buying and selling of foreign currency;

(vi) commission on line and telegraphic transfer and transactions;

(vii) commission on local and foreign drafts and transfers;

(viii) bills negotiable;

(ix) electronic transfers;

(x) special clearance;

(xi) traveller's cheques;

(xii) letter's of credit;

(xiii) commission on guarantees negotiable;

(xiv) commission on invoices discounted;

(xv) own acceptances;

(xvi) cable charges;

(xvii) interest on lending to banks;

(xviii) interest on lending to customers;

(xix) administrative charges imposed on a customer who exceeds an overdraft limit;

(xx) stop payments;

(xxi) standing orders;

(xxii) savings account;

(xxiii) transaction services, maintenance activities or ledger fees;

(xxiv) account maintenance;

(xxv) closure of accounts;

(xxvi) cheque books;

(xxvii) internet banking;

(xxviii) commission on lost connect cards;

(xxix) commission on status enquiries;

(xxx) excess withdrawal fees;

(xxxi) Bank of Zambia treasury bills handling charges;

(xxxii) commission on postage;

(xxxiii) commitment fees; and

(xxxiv) arrangement fees in the provision of credit;

[First Sch item 7(b) subs by para 2(b) of SI 79 of 2009.]

(i) principal and other finance charges charged on finance leases;

(ii) principal, interest and other finance charges charged on operating leases; and

(iii) principal, interest and other finance charges charged by institutions engaged in hire purchase;

[First Sch item 7(c) subs by para 2 of SI 37 of 2002, para 2 of SI 22 of 2007.]

(d) the operation of any account at a bank or financial institution;

[First Sch item 7(d) subs by para 2(a) of SI 12 of 2001.]

(e) the issue, allotment or transfer of ownership of shares in a company registered or incorporated under the Companies Act;

[First Sch item 7(e) subs by para 2(a) of SI 12 of 2001.]

(f) uncirculated new kwacha notes.

[First Sch item 7(f) ins by para 2(a)(ii) of SI 14 of 2004.]

8. Metal

The supply to a bank of gold in bullion form.

9. Funeral services

The supply or any goods or services in the course of a person’s burial or cremation, including the provision of any licence or certificate.

10. Reliefs at importation

(a) Goods which are imported duty free under regulation 74, 76, 78, 80, 82, 83, 84, 85, 86, or 94 of the Customs and Excise (General) Regulations, 2000, to the same limitations and conditions applicable to such rebate.

[First Sch item 11(a) subs by para 2(c) of SI 12 of 2001.]

(b) Imported goods in respect of which a rebate, refund or remission of duty is available under the Customs and Excise (Public Benefit Organisations) (Rebate, Refund or Remission) Regulations, 2009, subject to the same limitation and to such modification as may be specified therein.

[First Sch item 11(b) subs by para 2(a) of SI 56 of 2009; First Sch item 11 renumbered as item 10 by para 2(b) of SI 56 of 2009.]

11. Domestic kerosene

Domestic kerosene (paraffin).

12. Trade union subscriptions

Trade union subscriptions.

13. Treated and untreated mosquito nets

(a) finished mosquito nets (treated or untreated);

(b) insecticide kits used to treat mosquito nets;

[First Sch item 14 ins by para 2 of SI 12 of 2002; renumbered as item 13 by para 2(b) of SI 56 of 2009.]

14. Road construction agreement entered into with the Government of the Republic of Zambia

[First Sch item 15 ins by para 2 of SI 12 of 2002; renumbered as item 14 by para 2(b) of SI 56 of 2009.]

15. Statutory fees

Statutory fees which are prescribed and regulated by an Act of Parliament or statutory instrument except when paid as a consideration for a supply or when payment is not for the execution of statutory responsibilities.

[First Sch item 16 ins by para 2 of 11 of 2003; subs by para 2(a) of SI 43 of 2006; renumbered as item 15 by para 2(b) of SI 56 of 2009.]

16. Food and agriculture

(a) agricultural products- fresh edible vegetables, fruits, nuts, maize, soya beans, millet, cassava, sorghum, including flour produced from them; other cereals, except when any of the above product is—

(i) canned, frozen or freeze dried;

(ii) supplied by a restaurant, cafeteria, canteen or like establishment; or

(iii) wheat, cotton seed, seed cotton, lint babycorn, sweetcorn, mange-tout peas (snowpeas) sugar snaps, fresh or chilled beans (not dried), carrots, courgettes, patty pans, gem squash, butternut, peppers, leeks, chillies, asparagus, okra, spring onion, peas, tenderstem broccoli, purple sprouting broccoli, mini-savoy cabbage, mixed and sliced vegetables, paprika; or

(iv) Gooseberries, passion fruit, melons;

(b) animal products- meat and offals of cattle, swine, sheep, goats, game farm animals and poultry (including eggs), except—

(i) any of the above products that is supplied by a restaurant, cafeteria, canteen or like establishment;

(ii) cooked or smoked meats, meat processed beyond cutting, grinding or mincing including sausages, pate and the fatty livers of geese or ducks; crocodile products and any other product that the Ministry may, by regulations prescribe;

(c) milk- milk except powdered milk and any milk in cans or tins or when supplied by a restaurant, cafeteria or establishment;

(d) fish- uncooked, frozen or dried fish, except shellfish, ornamental fish or any fish supplied by a restaurant, cafeteria, canteen or like establishment;

(e) agricultural supplies—

(i) bulbs, seeds and plants for producing agricultural products of sub-item (a);

(ii) fertilisers, insecticides, rodenticides, fungicides, herbicides, anti-sprouting products and plant growth regulators and similar products for agricultural use;

(iii) live cattle, swine, sheep, goats, game farm animals and poultry;

(iv) stock feeds for cattle, swine, sheep, goats, game farm animals and poultry;

(v) empty jute, polypropylene bags and plastic granules used in the manufacture of polypropylene bags;

[First Sch item 17(e)(v) subs by para 2 of SI 66 of 2007.]

(vi) polymer granules and paste or liquid polymers used in the manufacture of polypropylene bags;

[First Sch item 17(e)(vi) subs by para 2(c) of SI 79 of 2009.]

(f) Infant cereal and infant formula, when prepared and labelled as such.

[First Sch item 17 ins by para 2(b) of 14 of 2004; subs by para 2(b) of SI 43 of 2006; renumbered as item 16 by para 2(b) of SI 56 of 2009; First Sch item 17(f) subs by para 2(b) of SI 12 of 2008.]

PART II
REVOKED STATUTORY INSTRUMENTS

	Statutory Instrument	Number
1	Value Added Tax Exemptions and Zero-Rating Order, 1995.	88 of 1995
2	Value Added Tax (Exemptions) Order, 1995	91 of 1995
3	Value Added Tax (Exemptions) (No. 2) Order, 1995	103 of 1995
4	Value Added Tax (Exemptions) (No. 3) Order, 1995	108 of 1995 {mprestriction ids="2,3,5"}
5	Value Added Tax (Exemptions) (No. 4) Order, 1995	122 of 1995
6	Value Added Tax (Exemptions) (No. 5) Order, 1995	146 of 1995
7	Value Added Tax (Exemptions) (No. 6) Order, 1995	150 of 1995
8	Value Added Tax (Exemptions) Order, 1995	22 of 1996
9	Value Added Tax (Exemptions) (No. 2) Order, 1995	27 of 1996
10	Value Added Tax (Exemptions) (No. 4) Order, 1995	79 of 1996

VALUE ADDED TAX (TAXABLE VALUE) REGULATIONS

[Section 51]

Arrangement of Regulations

Regulation

1. Title

2. Interpretation

3. Taxable value of local specified supplies

4. Taxable value of imported specified supplies

5. Revocation of S.I. No. 40 of 1997

SCHEDULE

SI 19 of 2007.

1. Title

These Regulations may be cited as the Value Added Tax (Taxable Value) Regulations.

2. Interpretation

In these Regulations, unless the context otherwise requires—

"specified supplies" means the goods listed in the Schedule to these Regulations.

3. Taxable value of local specified supplies

When specified supplies are supplied locally by a taxable supplier, the taxable value of the supplies shall be the greater of—

(a) the taxable value ascertained in accordance with section 10 of the Act; or

(b) the amount by which the recommended retail price exceeds the tax payable in respect of the supply.

4. Taxable value of imported specified supplies

When the specified supplies are imported, the taxable value of such supplies shall be the greater of—

(a) the taxable value ascertained in accordance with sub-section (3) of section 10 of the Act; or

(b) the amount by which the recommended retail price exceeds the tax payable in respect of the supply.

5. Revocation of S.I. No. 40 of 1997

The Value Added Tax (Taxable Value) Regulations, 1997 are hereby revoked.

SCHEDULE

[Regulation 2]

SPECIFIED SUPPLIES

1. Bulk and bagged cement (local and imported)

2. Carbonated drinks (local and imported)

3. Non-carbonated drinks (local and imported)

4. Maheu products

5. Clear beer (local and imported, bottled and canned)

6. Opaque beer (local and imported)

7. Cigarettes (local and imported)

8. Cell phone talk time (scratch cards)

9. Mineral water (local and imported)

VALUE ADDED TAX (RATE OF TAX) ORDER

[Section 9]

Arrangement of Paragraphs

Paragraph

1. Title

2. Rate of tax

SI 14 of 2008.

1. Title

This Order may be cited as the Value Added Tax (Rate of Tax) Order.

2. Rate of tax

(1) Notwithstanding sub-section (3) of section 9 of the Act, the prescribed rate of tax shall be 16 per centum.

(2) In sub-paragraph (1), "Act" means the Value Added Tax Act.

VALUE ADDED TAX (GENERAL) REGULATIONS

[Sections 2, 18 and 51]

[Re-denominate the currency as stipulated under S 4 of Re-denomination Act, 8 of 2012, read with Bank of Zambia Act, 43 of 1996.]

Arrangement of Regulations

Regulation

PART I
PRELIMINARY

1. Title

2. Interpretation

PART II
SUPPLY OF GOODS AND SERVICES

3. Goods not constituting supply

4. Transactions constituting supplies of services

5. Supplies by bankrupt or deceased estates, companies in receivership, etc

PART III
INPUT TAX

6. Input tax not allowed on motor vehicles

7. Input tax not allowed on commission charged by tax agent

8. Input tax not allowed on business entertainment

9. Input tax not allowed on telephone and internet services

9A. ...

10. Claim of tax on supply of petrol

10A. Claim of input tax on diesel

10B. Claim of input tax on electricity

10C. Input tax not allowed on construction of dwelling houses for staff

11. Input tax on goods lost in course of business

12. Input tax not allowed for late registration

13. Tax paid prior to registration

PART IV
GENERAL PROVISIONS

14. Certificate of registration

15. Tax return

16. Transfer of business

17. De-registration of supplier

18. Service of notice

19. Penalties for contravention of Rules

20. Revocation of S.I. No. 78 of 1995

SI 88 of 2010,

SI 86 of 2012,

SI 67 of 2014.

SI 92 of 2015,

SI 104 of 2016,

SI 82 of 2017,

SI 52 of 2018,

SI 90 of 2019,

SI 36 of 2020.

PART I
PRELIMINARY

1. Title

These Regulations may be cited as the Value Added Tax (General) Regulations.

2. Interpretation

In these Regulations, unless the context otherwise requires—

"date of registration" means the date shown in the register kept for purposes of section twenty-seven of the Act, as the date on which the registration becomes effective;

"complimentary hotel room" means a guest room at a hotel, lodge or similar establishment, which is offered at a value which is lower than its open market value; and

"electricity generation" means the production of electrical energy using physical and non-physical sources of energy such as water, wind, solar, petroleum, coal, biomass and any other source, except wood.

[Ins by reg 2 of SI 92 of 2015.]

PART II
SUPPLY OF GOODS AND SERVICES

3. Goods not constituting supply

(1) The supply of goods by any person in the course of a business conducted by that person shall not constitute a supply of goods for the purposes of the Act, if the goods are supplied as samples or for promotional or publicity purposes and fulfil the following conditions—

(a) the goods are supplied without consideration;

(b) the open market value of items supplied to any person does not exceed one hundred thousand kwacha in any accounting year; and

[Reg 3(1)(b) am by reg 2(a) of SI 86 of 2012.]

(c) the supplier of the goods provides to the Commissioner-General such documentary evidence as the Commissioner-General may, by administrative rule, require.

(2) A supply of goods does not include stock in trade or capital equipment obtained or purchased on, or before, 31st December, 2012, and on hand at the time of de-registration.

[Reg 3(2) am by reg 2(b) of SI 86 of 2012.]

4. Transactions constituting supplies of services

(1) In this regulation, "services of the business", in relation to a business carried on by a taxable supplier, means services provided in connection with the carrying on of that business, whether or not they are services of the kind provided in the course of that business.

(2) Where a taxable supplier causes any services of the taxable supplier’s business to be provided, with or without consideration—

(a) for the benefit of the taxable supplier;

(b) for the benefit of the taxable supplier and any other person;

(c) for the benefit of the taxable supplier’s business partners, or of any directors of, or persons employed in, the business; or

(d) for the benefit of customers of the business; the supply of such services shall be a taxable supply.

(3) Where a complimentary hotel room is offered to a guest by a taxable supplier, the actual rate that is offered shall constitute the taxable value.

5. Supplies by bankrupt or deceased estates, companies in receivership, etc.

(1) Where, by reason of death, bankruptcy, winding-up or other legal process in respect of a taxable supplier, whether an individual or a corporate body, the property or control of a business carried on by the taxable supplier and in respect of which the taxable supplier is registered is vested in another person, the provisions of the Act shall, on such vesting and for as long as that other person remains in such control, apply to that other person as if that person were the taxable supplier.

(2) A person carrying on or controlling the business of a taxable supplier in the circumstances referred to in sub-regulation (1) shall notify the Commissioner -General, in writing, of that fact, giving full particulars of the circumstances in which the control of the business concerned passed from the taxable supplier to that person.

(3) A notice referred to in sub-regulation (2) shall be given within 30 days after the control of the business is acquired by the person giving the notice.

(4) A person who fails to give notice as required by this regulation commits an offence and is liable, upon conviction, to a fine not exceeding ten thousand penalty units.

PART III
INPUT TAX

6. Input tax not allowed on motor vehicles

(1) Tax charged on the supply to, or importation by, a taxable supplier of a motor vehicle, including the supply of a motor vehicle on hire or lease, shall be excluded from any claim, deduction or credit under section 18 of the Act.

(2) In this regulation, "motor vehicle" includes a motor vehicle which has three or more wheels and which—

(a) is constructed or adapted, wholly or mainly, for the carriage of passengers; or

(b) has to the rear of the driver’s seat roofed accommodation fitted with side windows, or is constructed or adapted for the fitting of side windows;

but does not include—

(i) a motor vehicle capable of accommodating only one person or constructed or adapted for carrying twelve or more persons;

(ii) a motor vehicle of not less than three tonnes unladen weight;

(iii) an ambulance; or

(iv) a motor vehicle constructed for a special purpose, other than the carriage of persons and having no accommodation for carrying persons except as incidental to that purpose.

(3) This regulation shall not apply to the supply or importation of a motor vehicle, where the motor vehicle is supplied for—

(a) the purpose of leasing by a financial institution; or

(b) the purpose of re-sale by a car dealer or for use in a car hire or driving instruction business.

(4) Where a motor vehicle in respect of which input tax is not allowed to be deducted under this regulation is re-sold—

(a) the re-sale shall not constitute a supply of goods for the purpose of section 10 of the Act, where the re-sale value does not exceed the purchase price; or

(b) the excess of the re-sale value over the purchase price, where the re-sale value exceeds the purchase price, shall constitute a taxable value for purposes of section 10 of the Act.

7. Input tax not allowed on commission charged by tax agent

Tax charged on a commission received by a tax agent from a foreign supplier shall be excluded from any claim, deduction or credit under section 18 of the Act.

8. Input tax not allowed on business entertainment

(1) Tax charged on the supply to, or importation by, a taxable supplier of any goods or services used or to be used for the purposes of business entertainment, in respect of which input tax is not allowed, shall be excluded from any claim, deduction or credit under section 18 of the Act.

(2) For the purpose of this regulation, "business entertainment" includes the provision of any food, beverage, entertainment, amusement, recreation or hospitality of any kind and any incidental transportation provided to any person by a taxable supplier, whether directly or indirectly, in connection with a business carried on by the taxable supplier.

9. Input tax not allowed on telephone and internet services

(1) Tax charged on the supply of telephone and internet services to a taxable supplier shall be excluded from any claim, deduction or credit under section 18 of the Act.

(2) In this regulation, "telephone and internet services" do not include—

(a) interconnection fees and other services supplied to a service provider by another service provider; or

(b) telephone or internet services supplied to a hotel, lodge or similar establishment, in respect of telephone calls or internet services made by a customer of such establishment, where output tax on the supply of that service to that customer has been accounted for by the establishment.

9A. ...

[Reg 9A ins by reg 2 of SI 90 of 2019; rep by reg 2 of SI 36 of 2020.]

10. Claim of tax on supply of petrol

Tax charged on the supply of petrol to a taxable supplier is excluded from any claim, deduction or credit under section 18, except when that supply is for resale.

[Reg 10 subs by reg 2 of SI 104 of 2016.]

10A. Claim of input tax on diesel

Ninety per cent of tax charged on the supply of diesel to a taxable supplier may be included as a claim, deduction, or credit under section 18 of the Act, except that where the—

(a) supply is for resale, 100 per cent of the tax charged may be included as a claim, deduction or credit; or

(b) taxable supplier is carrying on mining operations, mineral processing or exploration, 70 per cent of tax charged on the supply of diesel to the taxable supplier may be included as a claim, deduction, or credit under section 18 of the Act.

[Reg 10A ins by reg 3 of SI 104 of 2016; subs by reg 3 of SI 90 of 2019.]

10B. Claim of input tax on electricity

Eighty per cent of tax charged may be included as a claim, deduction, or credit under section 18 of the Act, on the supply of electricity to a taxable supplier carrying on mining operations, mineral processing or exploration.

[Reg 10B rep by reg 2 of SI 82 of 2017; ins by reg 4 of SI 90 of 2019.]

10C. Input tax not allowed on construction of dwelling houses for staff

Tax charged on the supply to a taxable supplier of construction of dwelling houses for staff is excluded from any claim, deduction or credit under section 18, except where such supply is for the sale of a dwelling house by a person carrying on business of constructing dwelling houses for sale.

[Reg 10C ins by reg 3 of SI 104 of 2016.]

11. Input tax on goods lost in course of business

(1) A taxable supplier shall, where goods in respect of which input tax has been claimed, deducted or credited are lost in the course of or furtherance of the business, refund the input tax claimed, deducted or credited to the Commissioner-General—

(a) by including the input tax amount as an adjustment in the next return; and

(b) with interest for each subsequent month during which the adjustment is delayed, where the adjustment is not made in the next return.

(2) The Commissioner-General shall, where the goods in respect of which input tax has been claimed, deducted or credited are lost in the circumstances referred to in sub-regulation (1), and the requirements in that sub-regulation are not complied with, recover the input tax claimed, deducted or credited in respect of the goods as an assessment, in accordance with section 21 of the Act, dating back to the time when the input tax was claimed, deducted or credited.

(3) In this regulation, goods are lost in the furtherance of business if the goods are—

(a) expired, stolen, damaged or destroyed beyond use; or

(b) dealt with in a manner that makes the goods not taxable supplies for the purpose of the Act:

Provided that the taxable supplier provides evidence to the Commissioner-General of the expiry, theft, damage or destruction of the goods.

(4) A taxable supplier shall, where services, in respect of which input tax has been claimed, deducted or credited, are dealt with in a manner that makes them not taxable supplies for the purposes of the Act, refund the input tax claimed, deducted or credited to the Commissioner-General—

(a) by including the input tax amount as an adjustment in the next return; and

(b) with interest for each subsequent month during which the adjustment is delayed, where such adjustment is not made in the next return.

(5) The Commissioner-General shall, where services in respect of which input tax has been claimed, deducted or credited are dealt with in a manner that makes the services not taxable supplies for the purposes of the Act, and the requirements of sub-regulation (4) are not complied with, recover as an assessment, the input tax claimed, deducted or credited in respect of the services, in accordance with section 21 of the Act, dating back to the time when the input tax was claimed, deducted or credited.

12. Input tax not allowed for late registration

Input tax incurred by a supplier who is eligible for registration under section 28 of the Act but fails to register in accordance with that section and subsequently is assessed under sub-section (2) of section 29 of the Act, shall be excluded from any claim, deduction or credit under section 18 of the Act.

13. Tax paid prior to registration

(1) A supplier who is registered in anticipation of commencing trading activities, in these Regulations referred to as "an intending trader", may claim input tax credit or deduction in respect of goods or services that are received within a period of—

(a) four years from the date of registration as an intending trader for—

(i) electricity generation;

(ii) farming;

(iii) mining; and

(iv) tourism, where the supplier is engaged in the development of tourism facility or tourism infrastructure; and is registered and licensed by the Board of the Tourism Agency in accordance with the Tourism and Hospitality Act;

(b) within a period of 10 years from the date of registration as an intending trader for mining exploration; and

[Reg 13(4) subs by reg 3 of SI 92 of 2015; reg 13(1) to (3) deleted by reg 4(a) and reg 13(4) renumbered as reg 13(1) by reg 4(c) of SI 104 of 2016; subs by reg 2 of SI 52 of 2018.]

(2) The input tax claimed pursuant to sub-regulation (4) shall relate to the business activity as approved by the Commissioner-General at registration and shall not apply after the stated periods have elapsed, unless the trading activities have commenced and the supplier is making taxable supplies.

[Reg 13(4A) ins by reg 2(b) of SI 67 of 2014; renumbered as reg 13(2) by reg 4(c) of SI 104 of 2016.]

(3) A registered supplier, whether an individual or a corporate body, to whom or which this regulation applies, shall retain and produce all such records, invoices, accounts and any other information relating to the supply or importation, as the Commissioner-General may require for the period prescribed under sub-section (1) of section 42 of the Act.

[Reg 13(5) renumbered as reg 13(3) by reg 4(c) of SI 104 of 2016.]

(4) A claim under this regulation shall be allowed only to the extent of, and subject to, the conditions prescribed under section 18 of the Act, in relation to input tax generally.

[Reg 13(6) renumbered as reg 13(4) by reg 4(c) of SI 104 of 2016.]

(5) Without limiting the generality of sub-regulation (5), where the supplier is not in possession of documentary evidence as prescribed for the purposes of sub-section (3) of section 18 of the Act, the claim shall be—

(a) disallowed; or

(b) partly disallowed by rules of apportionment prescribed under that section and applying to the taxable supplier’s business.

[Reg 13(7) renumbered as reg 13(5) by reg 4(c) of SI 104 of 2016.]

(6) A cash basis of accounting shall be granted to intending traders referred to in sub-regulation (4) and taxable suppliers involved in mineral prospecting activities, upon registration for tax, notwithstanding the requirements in respect of cash accounting principles set out in the Value Added Tax (General) Rules.

[Reg 13(8) renumbered as reg 13(6) by reg 4(c) of SI 104 of 2016.]

PART IV
GENERAL PROVISIONS

14. Certificate of registration

(1) The Commissioner-General shall issue a registered supplier with a certificate of registration containing such particulars as the Commissioner-General may determine.

(2) A registered supplier shall display the certificate of registration in a prominent place at the registered supplier’s principal place of business.

(3) A certificate of registration shall not be capable of assignment or transfer, and shall be surrendered to the Commissioner-General on demand.

15. Tax return

A registered supplier engaged in making zero-rated supplies and whose turnover does not exceed two hundred million kwacha per annum shall submit a tax return every six months.

16. Transfer of business

(1) This regulation applies where a registered supplier, in this regulation referred to as "the transferor", assigns the registered supplier’s business, or a part of the business capable of separate operation, to another supplier, in this regulation referred to as "the transferee", as a going concern.

(2) Where a business or part of a business is transferred in accordance with sub-regulation (1), for the purpose of determining whether the transferee is liable to be registered, the taxable turnover of the business or part transferred shall be added to the turnover of any business carried on by the transferee.

(3) Any liability of the transferor under the Act subsisting immediately before the transfer takes effect, other than any criminal liability incurred by the transferor, including any liability—

(a) to keep and preserve, or to produce any records or accounts;

(b) to furnish a tax return;

(d) to comply with any requirement made in respect of the business by the Commissioner-General;

shall, on and from the transfer, and without affecting such liability of the transferor, subsist to the like extent and severally against the transferee.

(4) Tax shall not be charged or input tax claimed in respect of the transfer of a business, where the transferee is registered.

(5) Except to the extent that, upon the written request of the transferor and transferee, the Commissioner-General otherwise determines, any entitlement under the Act to credit or repayment of input tax that, immediately before the transfer takes effect, was vested in the transferor shall be extinguished so far as the transferor is concerned, but shall vest in and become the entitlement of the transferee.

(6) A transferor who fails to notify the Commissioner-General of a transfer within 30 days after it takes effect, commits an offence and is liable, upon conviction, to a fine not exceeding ten thousand penalty units.

17. De-registration of supplier

(1) The Commissioner-General shall, where a registered supplier ceases to supply taxable supplies, or the registered supplier’s taxable turnover falls below the turnover figure referred to in sub-section (1) of section 28 of the Act or sub-section (3) of section 53 of the Act, de-register the supplier.

(2) A registered supplier who ceases to supply taxable supplies shall, within 30 days of ceasing to be liable to be registered, notify the Commissioner-General, in writing, of that fact, and provide such information as the Commissioner-General may require.

(3) The Commissioner-General shall, upon receipt of the notification referred to in sub-regulation (2), cancel the supplier’s registration.

(4) A registered supplier who fails to notify the Commissioner-General as required by this regulation—

(a) commits an offence and is liable, upon conviction, to a fine not exceeding ten thousand penalty units; and

(b) shall be de-registered.

(5) The Commissioner-General may cancel the supplier’s registration where the Commissioner-General is aware that a registered supplier has ceased to make taxable supplies.

(6) A registered supplier whose registration is cancelled shall be served a notice of cancellation.

18. Service of notice

A notice or any other document required or authorised to be given under the Act, may be given—

(a) by delivering it to the person to whom it is directed;

(b) by leaving it at the usual or last known place of abode of that person;

(c) by sending it in a pre-paid registered letter addressed to that person at that person’s usual or last known place of abode, place of business or postal address;

(d) in the case of a company, by delivering it to the secretary for the company at its registered or principal office, or by sending it in a pre-paid registered letter addressed to the secretary of the company at that office; or

(e) where—

(i) the notice is to be given to a person in that person’s capacity as the holder of any interest in land; or

(ii) it is not practical, after reasonable inquiry, to ascertain the name or address of the person on whom the notice is to be served;

by addressing the notice to the person having the interest in the premises and by delivering it to a person on the premises, or if there is no person on the premises to whom it can be delivered, by affixing it, or a copy thereof, on a conspicuous part of the premises.

19. Penalties for contravention of Rules

(1) A person who—

(a) is a registered supplier and fails to issue a tax invoice or credit note in accordance with rule 3,4 or 5 of the Value Added Tax (General) Rules;

(b) is a registered supplier and fails to notify the Commissioner-General under rule 16 of the Value Added Tax (General) Rules, of a change in circumstances within the time allowed under the Rules; or

commits an offence and is liable, upon conviction, to a fine not exceeding ten thousand penalty units.

(2) A person who being a registered supplier, fails to use a cash register as required under sub-rule (2) of rule 8 of the Value Added Tax (General) Rules, commits an offence and is liable, upon conviction—

(a) in the case of a first offence, to a penalty not exceeding thirty thousand penalty units;

(b) in the case of a second offence, to a penalty not exceeding sixty thousand penalty units; or

(3) A person who contravenes any other provision of the Value Added Tax (General) Rules, commits an offence and is liable, upon conviction, to a fine not exceeding five thousand penalty units.

20. Revocation of S.I. No. 78 of 1995

The Value Added Tax (General) Regulations, 1995, are hereby revoked.

VALUE ADDED TAX (APPLICATION FOR REGISTRATION) ORDER

[Section 28]

[Re-denominate the currency as stipulated under S 4 of Re-denomination Act, 8 of 2012, read with Bank of Zambia Act, 43 of 1996.]

Arrangement of Paragraphs

Paragraph

1. Title

2. Interpretation

3. Taxable turnover

4. Application for registration

5. Revocation of S.I. No. 12 of 2004

SI 91 of 2012.

1. Title

This Order may be cited as the Value Added Tax (Application for Registration) Order.*

2. Interpretation

In this Order unless the context otherwise requires—

"relevant quarter" means any period of three consecutive months before the date of application; and

"relevant year" means any period of 12 consecutive months.

3. Taxable turnover

(1) For the purposes of sub-section (1) of section 28 of the Act, the prescribed turnover shall be calculated by reference to the taxable turnover of the business concerned during any relevant year, and if necessary, during each relevant quarter.

(2) A business shall be deemed to exceed the prescribed turnover for the purpose of sub-section (1) of section 28 of the Act if the taxable turnover of the business exceeds or is likely to exceed—

(a) eight hundred million kwacha in any relevant year; or

(b) two hundred million kwacha in any relevant quarter.

4. Application for registration

(1) The Commissioner-General shall require a person carrying on any business that is deemed to exceed the prescribed turnover referred to in sub-regulation (1) of regulation 3 to make an application for registration.

(2) For the purposes of an application for registration under sub-regulation (1) received between 1st January 2013 and 31st March, 2013, the Commissioner-General shall take into account supplies made in the period 1st October 2012 to 31st December, 2012.

(3) For the purpose of calculating the turnover of a business that is attributable to taxable supplies, the supplies made in the course of the business from 1st October 2012 to 31st December 2012, shall be treated as if they had been made on or after 1st January 2013.

5. Revocation of S.I. No. 12 of 2004

The Value Added Tax (Application for Registration) Order, 2004, is hereby revoked.

VALUE ADDED TAX (EXEMPTION) ORDER, 2014

[Sections 15 and 51]

Arrangement of Paragraphs

Paragraph

1. Title and commencement

2. Interpretation

3. Exempt services and supplies

4. Repeal of First Schedule to Act

SCHEDULE

SI 68 of 2014,

SI 102 of 2015,

SI 103 of 2016,

SI 65 of 2017,

SI 83 of 2017,

SI 30 of 2020,

SI 105 of 2021.

1. Title and commencement

(1) This Order may be cited as the Value Added Tax (Exemption) Order.

(2) This Order shall come into operation on 1st January, 2015.

2. Interpretation

In this Order, unless the context otherwise requires—

"animal feed" has the meaning assigned to it in the Animal Health Act, 2010;

"life policy" means a policy under which the insurer assumes a contingent obligation dependent on human life, or a life insurance contract, but does not include—

(a) a funeral policy; or

(b) a policy under which the contingent obligation dependent on human life forms a subordinate part of the insurance effected by the policy;

"poultry" means chicken, ducks, geese and turkeys; and

"transportation" means the commercial conveyance of persons by air, rail, road and water.

[Ins by para 2 of SI 103 of 2016.]

3. Exempt services and supplies

The services and supplies specified in the Schedule are exempt from tax.

4. Repeal of First Schedule to Act

The First Schedule to the Act is repealed.

SCHEDULE

[Paragraph 3]

[Sch am by para 2 of SI 102 of 2015, para 3 of SI 103 of 2016, para 3 of SI 65 of 2017, para 2 of SI 83 of 2017, para 2 of SI 30 of 2020, para 2 of SI 105 of 2021.]

EXEMPT SUPPLIES AND SERVICES

1. Water Supply Services

The supply of mains water and sewerage services, excluding sewerage pump out services.

2. Health Services

(a) the supply of health and medical services by a medical doctor, optician, dentist, hospital or clinic registered under the Health Professions Act, 2009; and

(b) the supply of articles designed for use by persons with disabilities.

3. Educational Services

(a) educational services provided to primary or secondary learners;

(b) educational services provided to post-secondary learners; and

4. Publications

(a) maps and charts; and

(b) journals.

5. Transportation Services

Transportation of persons, except when provided by a taxable supplier to a client as a leisure activity or for hire, by—

(a) air;

(b) rail;

(d) water.

5A. Aircraft

Purchase of aircraft licensed to carry passengers.

6. Conveyance, Sale or Lease of Real Property

(a) the sale or lease of an interest in land, other than—

(i) the sale, lease or rental of commercial property; and

(ii) the sale of a dwelling house by a person carrying on the business of constructing dwelling houses for sale; and

(b) any fee, royalty or similar right to exploit or remove any natural resource.

7. Financial and Insurance Services

(a) the arrangement, provision, or transfer of insurance services;

(b) the provision of the following charges and fees in the provision of financial services—

(i) interest on credit, lending and deposits;

(ii) commitment and arrangement fees in the provision of credit;

(iii) charges on cheques and cheque books;

(iv) charges on buying and selling of foreign currency;

(v) charges on negotiable bills;

(vi) charges on special clearance;

(vii) charges on letters of credit;

(viii) commission on drafts and transfers;

(ix) charges on savings accounts;

(x) charges for any account maintenance activity or ledger fees;

(xi) charges for closure of accounts;

(xii) commission and any charge on internet banking including electronic transfers, online, mobile banking and Telegraphic Transfer transactions;

(xiii) Bank of Zambia treasury bills handling charges; and

(xiv) commission on postage;

(i) other finance charges on finance leases;

(ii) principal, interest and other finance charges charged on operating leases; and

(iii) principal, interest and other finance charges charged by institutions engaged in hire purchase;

(d) the issue, allotment or transfer of ownership of shares in a company registered or incorporated under the Companies Act; and

(e) uncirculated new currency of the Republic in notes and coins.

8. Metals

The supply to a bank of gold in bullion form.

9. Funeral Services

(a) caskets and coffins;

(b) tombstones;

(d) services provided at the burial of a person by a funeral home, including the hire of a hearse, provision of furniture, tents and other funeral accessories, but excluding meals, beverages and other hospitality services.

10. Relief at Importation

(a) goods in respect of which a rebate, refund or remission of duty is available under regulations 74, 75, 78, 79, 80, 82, 83, 84, 85A, 86, 87, 87A, 94 and 95 of the Customs and Excise (General) Regulations, 2000, subject to the same limitations and conditions as pertain to the rebate, refund or remission and to such modification as may be specified therein;

(b) manufacturing inputs where duty is suspended under the Customs and Excise (Suspension) (Manufacturing Inputs) Regulations, 2020, subject to the same limitations and conditions that relate to the suspension of the duty and to such modification as may be specified therein;

(c) imported goods in respect of which a rebate, refund or remission of duty is available under the Customs and Excise (Public Benefit Organisation) (Rebate, Refund or Remission) Regulations, 2009, subject to the same limitations and to such modification as may be specified therein; and

(d) imported goods in respect of which a rebate, refund or remission of duty is available under the Customs and Excise (Suspension) (Electrical Energy) Regulations, 2017, subject to the same limitations and to such modification as may be specified therein.

11. Domestic Kerosene

The supply of domestic kerosene (paraffin).

12. Trade Union Subscriptions

Trade union subscriptions.

13. Treated and Untreated Mosquito Nets

(a) finished mosquito nets (treated and untreated);

(b) insecticide kits used to treat mosquito nets; and

14. Road Construction Agreements

Road construction agreements entered into with the Government of the Republic of Zambia prior to 1st July, 1995.

15. Statutory Fees

Statutory fees which are prescribed and regulated by an Act of Parliament or statutory instrument, except when paid as a consideration for a supply or when payment is not for the execution of statutory responsibilities.

16. Food and Agriculture

(a) agricultural products: fresh edible vegetables and fruits, maize, nuts, soyabeans, millet, cassava, sorghum and other cereals, including flour produced from the cereals, nuts, beans and tubers except where any of the products is—

(i) canned, frozen or freeze dried;

(ii) supplied by a restaurant, cafeteria, canteen or like establishment;

(iii) cotton seed, seed cotton, lint, baby corn, sweet corn, mangetout peas (snow peas), sugar snaps, fresh or chilled beans (not dried), carrots, courgettes, patty pans, gem squash, butternut, peppers, leeks, chillies, asparagus, okra, spring onion, peas, tenderstem broccoli, purple sprouting broccoli, mini-savoy cabbage, mixed and sliced vegetables or paprika; or

(iv) gooseberries, passion fruit and melons;

(b) animal products: meat and offal of cattle, swine, sheep, goats, game ranch animals and poultry, including eggs, except—

(i) any of these products where supplied by a restaurant, cafeteria, canteen or like establishment; and

(ii) cooked or smoked meat, meat processed beyond cutting, grinding or mincing, including sausage, pate and the fatty livers of geese or ducks or crocodile products;

(c) milk, except powdered milk and any milk in cans or tins or when supplied by a restaurant, cafeteria, canteen or like establishment;

(d) fish: uncooked, frozen or dried, except shellfish, ornamental fish or any fish supplied by a restaurant, cafeteria, canteen or like establishment;

(e) agricultural supplies—

(i) bulbs, seed and plants for producing agricultural products referred to in paragraph (a);

(ii) fish seeds;

(iii) fertilisers, insecticides, rodenticides, fungicides, herbicides, anti-sprouting products and plant growth regulators and similar products for agricultural use;

(iv) cattle, swine, sheep, goats, game farm animals, poultry and fish; and

(v) animal feed for cattle, swine, sheep, goats, game farm animals, poultry and fish;

(f) infant cereals and infant formula when prepared and labelled as such; and

(g) unprocessed and semi-processed tobacco.

VALUE ADDED TAX (ZERO-RATING) ORDER

[Sections 15 and 51]

Arrangement of Paragraphs

Paragraph

1. Title and commencement

2. Interpretation

3. Zero-rated goods and services

4. Repeal of Second Schedule to Act

FIRST SCHEDULE

SECOND SCHEDULE

SI 69 of 2014,

SI 88 of 2015,

SI 81 of 2017,

SI 3 of 2019,

SI 88 of 2019,

SI 29 of 2020,

SI 37 of 2020,

SI 81 of 2020,

SI 89 of 2020,

SI 107 of 2020,

SI 64 of 2021,

SI 79 of 2021,

SI 85 of 2021,

SI 104 of 2021,

SI 4 of 2022,

SI 59 of 2022.

1. Title and commencement

(1) This Order may be cited as the Value Added Tax (Zero-Rating) Order.

(2) This Order shall come into operation on 1st January, 2015.

2. Interpretation

In this Order, unless the context otherwise requires—

"designated official" means a person who is confirmed by the Ministry responsible for foreign affairs as being accorded rights and privileges under an international agreement;

"diplomat" means the head of a mission or a member of the diplomatic staff of a mission of a country accredited to the Republic of Zambia, who is entitled to diplomatic rights and privileges under an international agreement or the Diplomatic Immunities and Privileges Act;

"donor" means an accredited diplomatic mission or aid agency approved by the Government of the Republic of Zambia;

"donor funding" means funding provided by a donor but does not include funding provided in the form of a loan to the Government of the Republic of Zambia;

[Subs by para 2 of SI 81 of 2017.]

"eligible goods or services" means goods or services acquired by a diplomat or a designated official in the performance of their official duties for their personal use or enjoyment, subject to the following limitations—

(a) in the case of a diplomat, to the extent that the foreign country grants reciprocal privileges to the Zambian diplomats accredited to that country from Zambia; and

(b) in the case of a designated official, to the extent allowed by the Ministry responsible for foreign affairs;

"inclusive tour" ...;

[Rep by para 2 of SI 104 of 2021.]

"medical supplies and drugs" means any substance or mixture of substance prepared, sold or for use in—

(a) the diagnosis, treatment, mitigation or prevention of a disease, disorder or an abnormal physical state, or symptoms thereof, in human beings or animals; or

(b) restoring, correcting or modifying organic functions in human beings or animals, but does not include preparations, whether or not possessing therapeutic or prophylactic properties, commonly used for toilet purposes or in connection with the care of the human body, whether for cleaning, deodorising, beautifying, preserving or restoring;

"technical aid programme or project" means the provision of goods or services under a technical aid agreement or project with the Government of the Republic of Zambia, which are supplied solely for the purpose of the programme or project, but excludes the provision of goods or services to a sub-contractor or third party; and

"tourist" means a person who travels to, and stays in, places outside that person’s usual residence for leisure, business and other purposes not related to the exercise of an activity remunerated from within the place visited, but does not include a citizen or a person resident in Zambia.

3. Zero-rated goods and services

The goods and services specified in the Schedule are zero-rated.

4. Repeal of Second Schedule to Act

The Second Schedule to the Act is repealed.

FIRST SCHEDULE

[Paragraph 3]

[Sch am by para 2 of SI 88 of 2015, para 2 of SI 3 of 2019; renumbered as First Sch by para 2(a) of SI 88 of 2019; am by para 3 of SI 88 of 2019, para 2 of SI 29 of 2020, para 2 of SI 37 of 2020, para 2 of SI 81 of 2020, para 2 of SI 89 of 2020, para 2 of SI 107 of 2020, para 2 of SI 64 of 2021, para 2 of SI 79 of 2021, para 2 of SI 85 of 2021, para 3 of SI 104 of 2021, para 2 of SI 4 of 2022, para 2 of SI 59 of 2022.]

ZERO-RATED GOODS AND SERVICES

1. Group 1 - Export of Goods

(a) export of goods from Zambia by, or on behalf of, a taxable supplier, where evidence of exportation is produced as the Commissioner-General may require;

(b) the supply of freight transport services—

(i) from or to the Republic; and

(ii) from outside the Republic to other places outside the Republic transiting through the Republic including transhipment;

(c) the supply of goods by a duty free shop approved under regulation 51 of the Customs and Excise (General) Regulations, 2000, for export by passengers on flights to destinations outside Zambia;

(d) the supply of goods, including meals, beverages and duty free goods for use in aircraft stores on flights to destinations outside Zambia;

(e) the supply of aviation fuel;

(f) the supply of services which are physically rendered outside Zambia;

(g) ...

(h) international interconnection services.

2. Group 2 - Supplies to Privileged Persons

(a) goods imported by the President;

(b) goods imported by diplomats or a diplomatic mission accredited to the Republic of Zambia for the official purposes of that mission, to the extent that the foreign country grants reciprocal privileges to diplomats and to the diplomatic mission of Zambia in that country;

(c) the supply of goods or services to a donor in Zambia for the official purpose of that donor where evidence of purchase is produced by that donor or the Commissioner-General on behalf of the donor as the Commissioner-General may require;

(d) goods and services supplied to, or imported under, a technical aid programme or project executed by a written agreement between the Government of the Republic of Zambia and the donor, which are paid for through donor funding or funding from the Government where the programme or project is co-financed by the donor and the Government and the donor or contractor of the donor provides evidence of purchase of the goods and services pursuant to the agreement, as the Commissioner-General may require;

(e) supplies or imports under a technical aid agreement providing for exemption from taxation under the laws of Zambia—

(i) dated on or before 30th June, 1996; or

(ii) approved by the Minister responsible for finance; and

(f) goods or services supplied to or imported by a developer for the purposes of developing infrastructure in a multi-facility economic zone or industrial park.

3. Group 3 - Building Supplies

The supply of cement, roofing sheets, bricks and blocks to public benefit organisations approved by the Minister under the Income Tax Act, where evidence is provided that the building supplies are for construction of buildings for non-profit, humanitarian or poverty alleviation activities.

4. Group 4 - Mosquito Nets

The following raw material used for manufacturing mosquito nets—

(a) polyester textured yarn: HS Code 5402.33.00;

(b) textile dyestuff: HS Code 3204.11.00; and

5. Group 5 - Medical Supplies

(a) medical supplies and drugs;

(b) the supply to, or importation by, a medical doctor, optician, dentist, hospital or clinic registered under the Health Professions Act, 2009, or to a patient, of equipment designed solely for medical or prosthetic use;

(i) disinfection single entry chamber: HS Code 8424.89.00;

(ii) self sanitising walk: HS Code 8424.89.00; and

(iii) safe guard - disinfectant and sanitiser: HS Code 2828.90.10; and

(d) the following medical supplies—

(i) diagnostic test instruments and apparatus;

(ii) textile face mask without replaceable filter;

(iii) gas masks with mechanical parts or replaceable filters;

(iv) plastic face shields;

(v) plastic gloves;

(vi) other rubber gloves;

(vii) knitted or crocheted gloves which have been impregnated or covered;

(viii) textile gloves that are not knitted or crocheted;

(ix) disposable hair nets;

(x) protective garments for surgical or medical use;

(xi) other protective garments of textiles of rubberised textile;

(xii) protective garments made from plastic sheeting;

(xiii) liquid filled thermometer for direct reading;

(xiv) other thermometers;

(xv) alcohol solution-undenatured 80% by volume;

(xvi) alcohol solution-undenatured, 75% ethyl alcohol;

(xvii) hand sanitiser;

(xviii) other disinfectant preparations;

(xix) medical, surgical or laboratory sterilisers;

(xx) hydrogen peroxide in bulk;

(xxi) hydrogen peroxide presented as a medicament;

(xxii) hydrogen peroxide put up as a disinfectant preparation for cleaning surfaces;

(xxiii) other chemical disinfectant;

(xxiv) extra corporeal membrane oxygenation (ECMO);

(xxv) patient monitoring devices electro-diagnostic apparatus;

(xxvi) intubation kits; and

(xxvii) paper bed sheets.

6. Group 6 - Educational Materials

(a) books, including electronic learning material; and

(b) school exercise books.

7. Group 7 - Energy Saving Appliances, Machinery and Equipment

(a) fluorescent, hot cathode;

(b) light emitting diode lamps;

(d) solar water heaters;

(e) solar panels;

(f) solar streetlights;

(g) solar charge control units;

(h) electric accumulators—

(i) lead acid of a kind used for starting piston engines;

(ii) other lead acid accumulators;

(iii) nickel cadmium;

(iv) nickel iron; and

(v) other accumulators;

(i) static converters;

(j) electric generating sets—

(i) diesel or semi-diesel generators; and

(ii) generators with spark ignition internal combustion piston engines;

(k) liquefied Petroleum Gas (LPG) of HS codes—

(i) 2711.11.00: natural gas,

(ii) 2711.12.00: propane,

(iii) 2711.13.00: butanes,

(iv) 2711.14.00: ethylene, propylene, butylene and butadiene, and

(v) 2711.19.00: other similar products in gaseous state; and

(l) stoves, ranges, grates, cookers (including those with subsidiary boilers for central heating), barbecues, braziers, gas rings, plate warmers and similar non-electric domestic appliances, and parts thereof, of iron or steel for cooking and plate warmers that use gas fuel or for both gas and other fuels.

8. Group 8 - Agricultural Equipment and Accessories

(a) windmills;

(b) hammer mills of HS Code 8436.10.00;

(d) two wheel tractors, including ploughs, harrows, disc harrows, planters, seeders, rippers or sub-soilers, and cultivators of such tractors;

(e) tractors of HS Codes 8701.91.10, 8701.92.10, 8701.93.10, 8701.94.10, 8701.95.10, including ploughs, harrows, disc harrows, planters, seeders, rippers or sub-soilers and cultivators of such tractors;

(f) pumps of HS Codes 8413.20.00, 8413.50.00, 8413.60.00, 8413.70.00 and 8413.81.00;

(g) sprayers;

(h) manure spreaders;

(i) balers;

(j) combine harvesters;

(k) irrigation systems;

(l) animal feed grinder or mixer;

(m) pelleting machine;

(n) dryers for agricultural products of HS Code 8419.31.00;

(o) trailer of HS Code 8716.20.00; and

(p) principal on leasing finance for agricultural equipment and accessories listed in paragraphs (a) to (o).

9. Group 9 - Food and Agriculture

(a) wheat;

(b) flour produced from wheat;

(d) cooking oil.

10. Group 10 - Minerals

Copper Cathodes.

11. Group 11 - Capital Equipment

The supply of capital equipment and machinery set out in the First Schedule to a holder of a mining licence for large-scale mining under the Mines and Minerals Development Act, 2015.

SECOND SCHEDULE

[Paragraph 3]

[Second Sch ins by para 2(b) of SI 88 of 2019.]

EQUIPMENT AND MACHINERY ZERO-RATED WHEN SUPPLIED TO THE TAXABLE SUPPLIERS CARRYING OUT MINING OPERATIONS, MINERAL PROCESSING AND EXPLORATION

	HS Code	Tariff Description
1	84021100	Watertube boilers with a steam production >45t/hour
2	84021200	Watertube boilers with a steam production =<<45t/hour
3	84021900	Other vapour generating boilers, not elsewhere specified (incl. hybrid boilers)
4	84022000	Super-heated water boilers
5	84041000	Auxiliary plant for use with boilers of 84.02 or 84.03
6	84042000	Condensers for steam or other vapour power units
7	84051000	Producer gas or water gas generators; acetylene gas generators;
8	84061000	Steam turbines and other vapour turbines for marine propulsion
9	84068100	Steam/other vapour turbines (excl. for marine propulsion) with output >40mw
10	84068200	Steam/other vapour turbines (excl. for marine propulsion) with output <<=40mw
11	84101100	Of a power not exceeding 1,000 kW
12	84101200	Of a power exceeding 1,000 kW but not exceeding 10,000 kW
13	84101300	Of a power exceeding 10,000 kW
14	84122100	Hydraulic power engines and motors, linear acting (cylinders)
15	84122900	Hydraulic power engines and motors (excl. linear acting)
16	84123100	Pneumatic power engines and motors, linear-acting (cylinders)
17	84123900	Pneumatic power engines and motors (excl. linear acting)
18	84128010	Engines and motors, not elsewhere specific - Other; wind engines (windmills)
19	84131990	Pumps for liquids, with or designed to be fitted with a measuring device - Other
20	84133000	Fuel/lubricating/cooling-medium pumps for internal combustion engines
21	84134000	Concrete pumps
22	84135000	Reciprocating positive displacement pumps for liquids, not elsewhere specific
23	84136000	Rotary positive displacement pumps for liquids, not elsewhere specific
24	84137000	Centrifugal pumps for liquids, not elsewhere specific
25	84138100	Pumps for liquids, not elsewhere specific
26	84138200	Liquid elevators
27	84161000	Furnace burners for liquid fuel
28	84162000	Furnace burners for solid fuel or gas (incl. combination burners)
29	84163000	Mechanical stokers, including mechanical grates, ash dischargers and similar
30	84171000	Furnaces and ovens for roasting, melting... of ores/pyrites/metals
31	84178000	Industrial or laboratory furnaces (incl. incinerators)
32	84194000	Distilling or rectifying plant
33	84195000	Heat exchange units
34	84196000	Machinery for liquefying air or other gases
35	84198900	Non-domestic heating/cooling equipment, not elsewhere specific
36	84209100	Cylinders for calendering or other rolling machines
37	84241000	Fire extinguishers
38	84242000	Spray guns and similar appliances
39	84243000	Steam or sand blasting machines and similar jet projecting machines
40	84248900	Mechanical appliances for projecting/dispersing/spraying liquids/powders
41	84251100	Pulley tackle and hoists, powered by electric motor
42	84251900	Pulley tackle and hoists, not elsewhere specific (excl. skip or vehicle hoists)
43	84253100	Winches, capstans, powered by electric motor
44	84253900	Winches, capstans
45	84254100	Built-in jacking systems of a type used in garages
46	84254200	Hydraulic jacks and vehicle hoists
47	84254900	Jacks and vehicle hoists
48	84261100	Overhead travelling cranes on fixed support
49	84261200	Mobile lifting frames on tyres and straddle carriers
50	84261900	Transporter cranes, gantry cranes/bridge cranes, overhead travelling cranes
51	84262000	Tower cranes
52	84263000	Portal or pedestal jib cranes
53	84264100	Derricks, cranes, self-propelled, on tyres
54	84264900	Derricks, cranes, self-propelled (exclusive on tyres)
55	84269100	Derricks, cranes, designed for mounting on road vehicles
56	84269900	Ships derricks, cranes
57	84271000	Self-propelled works trucks powered by an electric motor
58	84272000	Self-propelled works trucks (exclusive. electric)
59	84279000	Works trucks fitted with lifting or handling equipment
60	84291100	Self-propelled bulldozers and angle dozers, track laying
61	84291900	Self-propelled bulldozers and angle dozers, (exclusive track laying)
62	84292000	Self-propelled graders and levellers
63	84293000	Self-propelled scrapers
64	84294000	Self-propelled tamping machines and road-rollers
65	84295100	Self-propelled front-end shovel loaders
66	84295200	Self-propelled bulldozers... with a 360℃ revolving superstructure
67	84295900	Self-propelled bulldozers, excavators, not elsewhere specific
68	84301000	Pile-drivers and pile-extractors
69	84303100	Self-propelled coal or rock cutters and tunnelling machinery
70	84303900	Coal or rock cutters and tunnelling machinery (excl. self-propelled)
71	84304100	Self-propelled boring or sinking machinery
72	84304900	Boring or sinking machinery (excl. self-propelled)
73	84305000	Self-propelled earth moving, grading, excavating, machinery, not elsewhere specific
74	84306100	Tamping or compacting machinery, not self-propelled
75	84306900	Earth moving, excavating, extracting... machinery, not self-propelled
76	84541000	Converters of a kind used in metallurgy or in metal foundries
77	84542000	Ingot moulds, ladles used in metallurgy or in metal foundries
78	84543000	Casting machines used in metallurgy or in metal foundries
79	84551000	Tube mills
80	84552100	Hot or combination hot and cold metal-rolling mills
81	84552200	Cold metal-rolling mills
82	84553000	Rolls for rolling mills
83	84672100	Drills of all kinds with self-contained electric motor
84	84672200	Saws with self-contained electric motor
85	84672900	Other tools with self-contained electric motor
86	84678100	Chain saws with non-electric motor
87	84741000	Sorting, screening, separating or washing machines for earth, stone
88	84742000	Crushing or grinding machines for earth, stone, ores
89	84743100	Concrete or mortar mixers
90	84743900	Mixing or kneading machines for earth, stone, ores
91	84748000	Other machinery for earth, stone, ores
92	84798200	Machines for mixing, kneading, crushing, grinding, having individual functions
93	84798900	Machines, having individual functions
94	85011000	Motors of an output =<<37.5 W
95	85012000	Universal ac/dc motors of an output >37.5 W
96	85013100	Dc motors and generators of an output =<<750 W
97	85013200	Dc motors and generators of an output >750 W-<<=75 kW
98	85013300	Dc motors and generators of an output >75 kW-<<=375 kW
99	85013400	Dc motors and generators of an output >375 kW
100	85014000	Ac motors, single-phase
101	85015100	Ac motors, multi-phase, of an output =<<750 W
102	85015200	Ac motors, multi-phase, of an output >750 W-<<=75 kW
103	85015300	Ac motors, multi-phase, of an output >75 kW
104	85016100	Ac generators (alternators) of an output =<<75 kVA
105	85016200	Ac generators (alternators) of an output >75 kVA-<<=375 kVA
106	85016300	Ac generators (alternators) of an output >375 kVA-<<=750 kVA
107	85016400	Ac generators (alternators) of an output >750 kVA;
108	85021100	Generating sets with compression-ignition engines, =<<75 kVA
109	85021200	Generating sets with compression-ignition engines, >75 kVA-<<=375 kVA
110	85021300	Generating sets with compression-ignition engines, >375 kVA
111	85022000	Generating sets with spark-ignition internal combustion piston engines
112	85023900	Generating sets, (excluding wind-powered)
113	85024000	Electric rotary converters
114	85041000	Ballasts for discharge lamps or tubes
115	85042100	Liquid dielectric transformers, power handling capacity =<<650kva
116	85042200	Liquid dielectric transformers, power handling capacity 650-10000kva
117	85042300	Liquid dielectric transformers, power handling capacity >10000kva
118	85043100	Transformers, power handling capacity =<<1kva
119	85043200	Transformers, power handling capacity 1-16kva
120	85043300	Transformers, power handling capacity 16-500kva
121	85043400	Transformers, power handling capacity >500kva
122	85044000	Static converters
123	85045000	Inductors
124	85052000	Electro-magnetic couplings, clutches and brakes
125	85071000	Lead-acid accumulators for starting piston engines
126	85072000	Lead-acid accumulators (excl. for starting piston engines)
127	85073000	Nickel-cadmium accumulators
128	85074000	Nickel-iron accumulators
129	85075000	Nickel-metal hydride
130	85076000	Lithium-ion
131	85078000	Electric accumulators (excluding lead-acid, nickel-cadmium or nickel-iron)
132	85141000	Resistance heated furnaces and ovens
133	85142000	Induction or dielectric furnaces and ovens
134	85143000	Industrial or laboratory furnaces and ovens
135	85144000	Other equipment for heat treatment of materials by induction or dielectric loss
136	85151100	Soldering irons and guns
137	85151900	Brazing or soldering machines and apparatus
138	85152100	Machines for resistance welding of metal, fully or partly automatic
139	85152900	Machines and apparatus for resistance welding of metal, not automatic
140	85153100	Machines for arc (incl. plasma arc) welding of metals, automatic
141	85153900	Machines for arc (incl. plasma arc) welding of metals, not automatic
142	85158000	Machines and apparatus for welding/spraying of metals, not elsewhere specific
143	85301000	Electrical signalling... equipment for railways or tramways
144	85308000	Electrical signalling... equipment for roads, inland waterways
145	85311000	Electrical burglar or fire alarms and similar apparatus;
146	85312000	Indicator panels with liquid crystal devices or light-emitting diodes
147	85318000	Electrical apparatus for sound or visual signalling, not elsewhere specific
148	85321000	Fixed capacitors for 50/60 hz circuits having power capacity >=0.5kvar
149	85322100	Fixed electrical capacitors of tantalum
150	85322200	Fixed electrical capacitors of aluminium electrolyte
151	85322300	Fixed electrical capacitors of ceramic dielectric, single layer
152	85322400	Fixed electrical capacitors of ceramic dielectric, multilayer
153	85415000	Semiconductor devices (excl. photosensitive)
154	85431000	Particle accelerators
155	85432000	Signal generators
156	85433000	Machines/apparatus for electroplating, electrolysis or electrophoresis
157	85437000	Other machines and apparatus
158	85444200	Other electric conductors, for a voltage <<= 1,000 V...Fitted with connectors
159	85451100	Carbon electrodes for furnaces
160	86011010	Specially constructed for use underground in mines
161	86011090	Rail locomotives powered from an external source of electricity - other
162	86012010	Specially constructed for use underground in mines
163	86012090	Rail locomotives powered by electric accumulators - other
164	86021000	Diesel-electric locomotives
165	86029000	Rail locomotives, not elsewhere specific; locomotive tenders
166	86061000	Tank wagons and the like, not self-propelled
167	86063000	Self-discharging vans and wagons, not elsewhere specific
168	86069100	Railway or tramway goods vans and wagons, covered and closed
169	86069200	Railway or tramway goods vans and wagons, open, with sides
170	86069900	Railway or tramway goods vans and wagons, not self-propelled, not elsewhere specific
171	86071100	Driving bogies and bissel-bogies of railway or tramway locomotives
172	86071200	Bogies and bissel-bogies, not elsewhere specific of railway locomotives/rolling stock
173	86080010	Railway/tramway track fixtures/fittings; mechanical signalling-Track features Fittings
174	86080090	Railway/tramway track fixtures/fittings; mechanical signalling... – other
175	86090000	Containers specially designed for transport by one or more methods
176	87051000	Crane lorries
177	87052000	Mobile drilling derricks
178	87054000	Concrete-mixer lorries
179	87059000	Special purpose motor vehicles, not elsewhere specific (e.g. breakdown lorries)

VALUE ADDED TAX (ELECTRONIC FISCAL DEVICES) REGULATIONS

[Section 51]

Arrangement of Regulations

Regulation

1. Title

2. Interpretation

3. Commissioner-General to operate tax invoice management system

4. Requirement for use of electronic fiscal devices

5. Activation of taxable suppliers and electronic fiscal devices on tax invoice management system

6. Taxable supplier to issue tax invoice

7. Use of accounting software

8. Temporary use of manual invoicing system

9. Claim for tax refund

10. Display of notice

11. Inspection log books

12. Fault repair

13. Requirements for electronic fiscal device or virtual electronic fiscal device

14. Accreditation of manufacturer

15. Accreditation of distributor

16. Accreditation of vendor

17. Cost of acquisition of electronic fiscal device or software of virtual electronic fiscal device

18. Disconnection of electronic fiscal devices or virtual electronic fiscal device from tax invoice management system

19. Non-transfer of electronic fiscal device and virtual electronic fiscal device

20. Inspection

21. Offences and penalties

22. Savings and transitional provision

SI 33 of 2020,

SI 106 of 2021.

1. Title

These Regulations may be cited as the Value Added Tax (Electronic Fiscal Devices) Regulations.

2. Interpretation

In these Regulations, unless the context otherwise requires—

"authorised officer" has the meaning assigned to the word in the Act;

"customer" means a person to whom, a business supplies goods or services;

"distributor" means a distributor of an electronic fiscal device;

"electronic fiscal device" has the meaning assigned to the word in the Act;

"electronic payment machine" has the meaning assigned to the word in the Act;

"fiscalised" means containing fiscal memory;

"manufacturer" means a manufacturer of an electronic fiscal device;

"nonfiscalised electronic register" means an electronic payment machine to which a fiscal memory device can be attached;

"State institution" has the meaning assigned to the word in the Constitution;

"tax invoice management system" means the Authority’s information management system used to receive, store and process an invoice from an electronic fiscal device or a virtual electronic fiscal device relating to a taxable transaction undertaken by a taxable supplier in the course of that taxable supplier’s daily business;

"vendor" means a vendor of a virtual electronic fiscal device;

"virtual" in relation to an electronic fiscal device means the capacity to electronically generate or produce tax invoices and other reports and to transmit invoice data in real time to the tax invoice management system through the use of software; and

"Zambia Information and Communications Technology Authority" means the Zambia Information and Communications Technology Authority established under the Information and Communication Technologies Act, 2009.

3. Commissioner-General to operate tax invoice management system

The Commissioner-General shall establish and operate a tax invoice management system which shall—

(a) be electronically connected to a taxable supplier’s electronic fiscal device, or virtual electronic fiscal device; and

(b) use a fiscal management software which is compatible with the software on the electronic fiscal device or a virtual electronic fiscal device.

4. Requirement for use of electronic fiscal devices

(1) A taxable supplier shall for the purposes of recording a taxable transaction—

(a) use an electronic fiscal device or a virtual electronic fiscal device supplied by an accredited distributor or vendor and connected to the tax invoice management system;

(b) ensure that all taxable supply transactions are electronically transmitted to the tax invoice management system from the electronic fiscal device or virtual electronic fiscal device in real time;

(c) ensure as far as practicable that there is uninterrupted network connectivity for the purpose of transmitting fiscal data to the tax invoice management system.

(2) The Commissioner-General may exempt, on conditions set out in the administrative rules, a category of a taxable supplier from using an electronic fiscal device or a virtual electronic fiscal device.

(3) An electronic fiscal device under sub-regulation (1) shall be type approved by the Zambia Information and Communications Technology Authority.

(4) A taxable supplier shall not open, modify or attempt to modify an electronic fiscal device or modify or attempt to modify a virtual electronic fiscal device without the authorisation of the Commissioner-General.

(5) A taxable supplier who contravenes sub-regulation (4), commits an offence and is liable, on conviction, to a fine not exceeding ninety thousand penalty units or to imprisonment for a period not exceeding two years, or to both.

5. Activation of taxable suppliers and electronic fiscal devices on tax invoice management system

(1) A taxable supplier shall apply to the Commissioner-General for activation of that taxable suppliers access on the tax invoice management system.

(2) The Commissioner-General shall, unless the taxable supplier is exempted under regulation 4(2) from using an electronic fiscal device or a virtual electronic fiscal device, activate the taxable supplier’s access on the tax invoice management system and notify the taxable supplier of the effective date of activation.

(3) A taxable supplier whose access is activated on the tax invoice management system under sub-regulation (2), shall apply to the Commissioner-General, for the connection of an electronic fiscal device or a virtual electronic fiscal device to the tax invoice management system within seven days of that taxable supplier’s activation.

(4) Subject to regulation 4, the Commissioner-General may approve the connection of an electronic fiscal device or a virtual electronic fiscal device and notify the taxable supplier of the approval.

(5) A taxable supplier shall ensure that an electronic fiscal device or a virtual electronic fiscal device approved for connection to the tax invoice management system under sub-regulation (4) becomes operational within 10 days from the date of the approval.

6. Taxable supplier to issue tax invoice

(1) A taxable supplier shall issue a tax invoice to a customer for the consideration paid or payable by that customer for every taxable supply.

(2) Where a customer is also a taxable supplier or a State institution, the tax invoice issued under sub-regulation (1) shall specify the name, address and Taxpayer Identification Number of the customer.

(3) Sub-regulation (2) applies whether the customer is present or not at the time of the transaction and whether the customer fails or refuses to take the tax invoice.

(4) A customer that is issued with a tax invoice may verify the authenticity of that invoice with the Authority.

(5) A customer shall report to the Authority if that customer has—

(a) not been issued with a tax invoice in respect of a taxable supply; or

(b) been issued with an invoice that does not contain accurate fiscal data relating to the taxable supply.

7. Use of accounting software

The Commissioner-General may allow a taxable supplier to use an accounting software to issue tax invoice if that accounting software is integrated with the tax invoice management system.

[Reg 7 subs by reg 2 of SI 106 of 2021.]

8. Temporary use of manual invoicing system

(1) The Commissioner-General may authorise a taxable supplier to temporarily use a manual invoicing system for a specified period where the—

(a) electronic fiscal device or virtual electronic fiscal device is undergoing inspection or maintenance;

(b) electronic fiscal device or virtual electronic fiscal device is seized by an authorised officer in the course of an investigation; or

(c) use of the electronic fiscal device or virtual electronic fiscal device is disrupted and the taxable supplier has notified the Commissioner-General of the cause of the disruption.

(2) A taxable supplier shall, where that taxable supplier’s use of an electronic fiscal device or virtual electronic fiscal device is disrupted for a continuous period of 24 hours, notify the Commissioner-General within 24 hours of the taxable supplier becoming aware of the disruption and the cause thereof.

9. Claim for tax refund

(1) A claim for a tax refund on a tax invoice issued by a taxable supplier is not valid for refund if the tax invoice is not recorded on the tax invoice management system.

(2) Despite sub-regulation (1), a claim for tax refund on a tax invoice issued by a taxable supplier using accounting software or a manual invoicing system authorised by the Commissioner-General is valid for refund.

10. Display of notice

(1) A taxable supplier shall display in a conspicuous place of business of the taxable supplier a notice relating to the use or exemption from use of electronic fiscal device or virtual electronic fiscal device as the Commissioner-General may specify.

(2) A taxable supplier who contravenes sub-regulation (1) commits an offence and is liable, on conviction, to a fine not exceeding ninety thousand penalty units.

11. Inspection log books

(1) A taxable supplier whose electronic fiscal device or virtual electronic fiscal device is connected to the tax invoice management system shall keep and maintain an inspection log book for each of electronic fiscal device or virtual electronic fiscal device in use.

(2) The inspection log book shall be kept at a place where the electronic fiscal device or virtual electronic fiscal device is in use.

12. Fault repair

(1) A taxable supplier shall, where an electronic fiscal device develops a fault that cannot be remedied without opening the device—

(a) immediately cease the use of the electronic fiscal device;

(b) notify the Commissioner-General and the accredited distributor, in the manner set out in the administrative rules, about the fault and record the time of notification in the log book;

(i) the fault, description and time of the fault of an electronic fiscal device;

(ii) the findings made by an accredited distributor with regard to the fault;

(iii) reasons for an unreported defect, if any;

(iv) when the electronic fiscal device was opened, period for which an electronic fiscal device was not in use and when use of the electronic fiscal device was restored; and

(v) any other information relating to the electronic fiscal device.

(2) A taxable supplier shall, where a virtual electronic fiscal device develops a fault that renders it inoperable—

(a) notify the Commissioner-General and the accredited vendor, in the manner set out in the administrative rules, about the fault and record the time of notification in the log book;

(b) record, in the inspection log book—

(i) the fault, description and time of the fault of the virtual electronic fiscal device;

(ii) the findings made by the accredited vendor with regard to the fault;

(iii) reasons for an unreported fault, if any;

(iv) the period for which a virtual electronic fiscal device was not in use and when the virtual electronic fiscal device is put to use after repair; and

(v) any other information relating to the virtual electronic fiscal device.

(3) The details entered in the inspection log book under sub-regulations (1) and (2) by a taxable supplier shall be legible and appropriately signed, indicating the name and identity card number of the person responsible for entering the details and the entry date and time.

(4) An accredited manufacturer, distributor or vendor providing technical support to a taxable supplier using an electronic fiscal device or virtual electronic fiscal device, shall record the information under sub-regulations (1) and (2).

13. Requirements for electronic fiscal device or virtual electronic fiscal device

An electronic fiscal device or virtual electronic fiscal device for use by a taxable supplier under these Regulations shall meet the requirements set out in the administrative rules.

14. Accreditation of manufacturer

(1) The Commissioner-General may invite a manufacturer to bid in accordance with the Public Procurement Act, 2008, for accreditation as a supplier of an electronic fiscal device.

(2) The Commissioner-General may accredit the manufacturer for a specified period where—

(a) an electronic fiscal device to be supplied by the manufacturer is type approved by the Zambia Information and Communications Technology Authority; and

(b) the manufacturer of an electronic fiscal device has adequate back-up services and accessories for the user of the electronic fiscal device.

(3) A manufacturer who is accredited in accordance with this regulation may supply an electronic fiscal device to an accredited distributor.

(4) An accredited manufacturer shall, for the duration of the accreditation, provide technical support to an accredited distributor in relation to the use of an electronic fiscal device supplied.

15. Accreditation of distributor

(1) The Commissioner-General may invite a distributor to bid in accordance with the Public Procurement Act, 2008, for accreditation as a distributor of an electronic fiscal device.

(2) The Commissioner-General may accredit the distributor for a specified period where—

(a) an electronic fiscal device to be supplied by the distributor is type approved by the Zambia Information and Communications Technology Authority; and

(b) the distributor of the electronic fiscal device has adequate back-up services and accessories for the user of the electronic fiscal device that is distributed.

(3) A distributor who is accredited in accordance with this regulation may supply an electronic fiscal device to a taxable supplier.

(4) An accredited distributor shall, for the duration of the accreditation, provide technical support to a taxable supplier in relation to the use of an electronic fiscal device supplied.

(5) Where the accredited distributor intends to cease to supply any model of the electronic fiscal device, the distributor shall give notice of not less than 90 days of the cessation to the Commissioner-General accompanied with a commitment plan on the manner in which technical support to the taxable supplier shall continue to be provided.

16. Accreditation of vendor

(1) The Commissioner-General may invite a vendor of virtual electronic fiscal device to bid in accordance with the Public Procurement Act, 2008, for accreditation as a vendor of virtue electronic fiscal device.

(2) The Commissioner-General may accredit the vendor, where the—

(a) virtual electronic fiscal device to be supplied by the vendor meets the specification set out in the administrative rules; and

(b) vendor has the capacity to provide technical support in relation to the virtual electronic fiscal device.

(3) A vendor who is accredited in accordance with this regulation may supply to a taxable supplier a virtual electronic fiscal device.

(4) An accredited vendor shall, for the duration of the accreditation, provide technical support to a taxable supplier in relation to the software of a virtual electronic fiscal device supplied.

(5) Where the accredited vendor ceases to supply a virtual electronic fiscal device, the vendor shall give notice of not less than 90 days of the cessation to the Commissioner-General accompanied with a commitment plan on the manner in which technical support to the taxable supplier shall continue to be provided.

17. Cost of acquisition of electronic fiscal device or software of virtual electronic fiscal device

A taxable supplier shall bear the cost of acquiring an electronic fiscal device of a virtual electronic fiscal device.

18. Disconnection of electronic fiscal devices or virtual electronic fiscal device from tax invoice management system

(1) Where a taxable supplier ceases to be a taxable supplier under the Act, the electronic fiscal device or virtual electronic fiscal device shall be disconnected from the tax invoice management system.

(2) The taxable supplier shall keep and maintain accounts and records generated by an electronic fiscal device or a virtual electronic fiscal device that has been disconnected from the tax invoice management system under sub-regulation (1) for the period that the taxable supplier is required to keep and maintain the accounts and records under the Act.

19. Non-transfer of electronic fiscal device and virtual electronic fiscal device

A taxable supplier shall not permit the use by a third party of that taxable supplier’s activated access or an electronic fiscal device or a virtual electronic fiscal device connected to the tax invoice management system in accordance with regulation 5.

20. Inspection

The Commissioner-General or an authorised officer shall, for the purpose of ensuring compliance with these Regulations, at any reasonable time—

(a) enter on and inspect any premises where an electronic fiscal device or a virtual electronic fiscal device is used;

(b) examine computers, books, records and other relevant documentation of a taxable supplier; and

(c) examine any electronic fiscal device, fiscal memory device or nonfiscalised electronic register of a taxable supplier.

21. Offences and penalties

(1) A person commits an offence if that person—

(a) fails to use an electronic fiscal device, a virtual electronic fiscal device;

(b) wilfully refuses or fails to issue a tax invoice from an electronic fiscal device or a virtual electronic fiscal device;

(d) tampers with, alters or falsifies data transmitted to, or received, recorded, analysed, formatted or stored by an electronic fiscal device, a virtual electronic fiscal device or a component thereof;

(e) issues an invoice that does not meet the requirements of these Regulations;

(f) intentionally or maliciously damages an electronic fiscal device or a virtual electronic fiscal device, or negligently handles an electronic fiscal device or a virtual electronic fiscal device thereby causing damage to the device; or

(g) operates an electronic fiscal device or a virtual electronic fiscal device in a manner that results in a taxable supplier avoiding or evading paying tax.

(2) A person convicted of an offence under sub-regulation (1) is liable, on conviction, in the case of a—

(a) first offence, to a penalty not exceeding one hundred thousand penalty units;

(b) second offence, to a penalty not exceeding two hundred thousand penalty units; and

(c) third or subsequent offence, to a penalty not exceeding three hundred thousand penalty units, or to imprisonment for a term not exceeding three years, or to both.

[Reg 21(2) subs by reg 3 of SI 106 of 2021.]

22. Savings and transitional provision

(1) An electronic fiscal device or a virtual electronic fiscal device that, immediately before the commencement of these Regulations was activated on the tax invoice management system, shall continue to be operated in accordance with these Regulations.

(2) A manufacturer or vendor who was authorised to supply an electronic fiscal device or a virtual electronic fiscal device immediately before the commencement of these Regulations is deemed to be an accredited manufacturer or vendor for the purposes of these Regulations for the remainder of the duration of the contract between the Authority and the manufacturer or vendor and the manufacturer or vendor shall immediately after the expiry of the contract comply with these Regulations.

(3) A taxable supplier shall comply with these Regulations by 1st June, 2020.

(4) A taxable supplier who is unable to comply with these Regulations by 1st June, 2020 shall apply for an extension to the Commissioner-General, stating the reasons.

(5) The Commissioner-General may, on receipt of an application under sub-regulation (4), grant an extension for a period that the Commissioner-General may determine.

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