ZIMRA Looking Into Taxing Income Received During eCommerce Transactions

ZIMRA’s Commissioner-General Faith Mazani today at the FINGAZ Tax Review Meeting shared the Revenue Authority’s plans to start taxing income received on online platform’s like Airbnb.

ZIMRA is currently learning and seeing how best they can do this:

With the digital age upon us, as ZIMRA we are catching up with learning,
knowledge management and improvement to be geared for Taxation of the Digital Commerce which will dominate the rest of this century. As such, innovations to capture tax-bases such as rental incomes earned through AirBnB and other platforms will form part of the Domestic Revenue Mobilisation infrastructure.
Faith Mazani Commissioner General ZIMRA

Whilst the Commissioner General’s speech didn’t touch on what exact measures the authority would be putting in place to tax people on these platforms it’s safe to say it will be difficult especially on platforms like Airbnb. The money is traded between the landlord and tenant and this process is facilitated online and the government and ZIMRA by extension have no efficient way of knowing who is on Airbnb and who isn’t.

Maybe ZIMRA will request Airbnb users to register but once you consider our government’s history of abusing tax funds, I’ll be surprised if there are any people rushing to declare that they want to pay more tax.

The commissioner general also mentioned that Mthuli Ncube “addressed areas of the tax laws specific to sectors like E-Commerce and satellite broadcasting.” Whilst searching for the reference to eCommerce tax in the budget I couldn’t find those specific details so we are not entirely clear on how that will work.