The Zambia Association of Manufacturers (ZAM) has called on the government to expedite Value Added Tax (VAT) refunds for manufacturers who consistently comply with tax regulations. During the 2024 pre-budget meeting in Lusaka, ZAM President Ashu Sagar emphasized the need for a scorecard system to prioritize compliant manufacturers for VAT refunds and other tax-related reimbursements.

Mr. Sagar proposed significant tax reforms, including:

Reducing Income Tax Rates: Manufacturers serving domestic and export markets would see their income tax rates reduced from 20% and 10% to 16% and 14%, respectively.

Extending Proof of Exportation Timeframe: The timeframe for presenting proof of exportation under VAT Rule 18 would be extended from the current 3 months to 6 months.

Increasing Turnover Tax Threshold: Aligning the Turnover Tax (TOT) threshold with the Micro, Small, and Medium Enterprises (MSME) classification by raising it from K800,000.

Additionally, Mr. Sagar urged the government to standardize council levies under a single overseeing ministry and develop regulations for product listings in chain stores. He also highlighted the need to strengthen existing incentive frameworks and optimize tax structures to enhance the manufacturing sector’s performance, which has been impacted by broader economic trends