HUGE COST increases are on the way for Zimbabwe's road operators, as the government has scrapped sales tax exemptions for services in the country. Officially, the changes are to pave the way for the introduction of VAT, but as the new regulations stand, tax is now being levied on tax.
Says Arthur Sandwith of the Transport Operators Association: The 17,5% sales tax is now being levied at each stage of a business transaction, and then has to be levied at the next stage as well. If an operator is carrying goods for a customer, he has to add the sales tax and then the customer has to add sales tax as well. Previously, there was a provision to exempt services from sales tax, which would only be levied when goods were finally sold.
