ZAMBIA Law and Practice Contributed by: Mulenga Chiteba, Constance Namatai Mwango and Diana Chisale, Mulenga Mundashi Legal Practitioners
9.13 Approach to Digital Services Taxation In 2024, Zambia took proactive steps to tax the digi - tal economy by implementing VAT regulations for non-resident electronic service providers. While the country has not introduced a specific digital services tax, the current VAT framework serves to capture rev - enue from digital transactions. Additionally, Zambia is a member of the OECD/G20 Inclusive Framework on BEPS and has agreed to the Two-Pillar Solution to address the tax challenges arising from the digi - talisation of the economy. This indicates Zambia’s commitment to aligning with international tax reforms
To align with international practice relating to coun - try-by-country reporting, multinational enterprises are required to provide the following information: • an overview of allocation of income, taxes and business by tax jurisdiction; • a list of the constituent entities in the multinational enterprise group aggregated per tax jurisdiction; and • ancillary information such as the nature of the activities of a respective constituent entity. 9.12 Digital Economy Businesses Zambia has implemented changes to tax transactions conducted by non-resident digital service providers. The government introduced regulations which man - date that non-resident providers of electronic services register for VAT using a simplified system, and collect and remit VAT at a rate of 16% on services delivered to Zambian residents.
concerning the digital economy. 9.14 Offshore IP Provisions
Payments in respect of royalties for the use of intellec - tual property from a source within Zambia or deemed to be within Zambia to a non-resident are subject to withholding tax at the rate of 20%.
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