This guide presents a detailed overview of the corporate tax regime in Zambia as of 2025, covering statutory rates, special sector regimes, and notable incentives relevant for domestic and international entities.
Corporate Tax Structure in Zambia
The Zambian corporate tax system operates on a flat rate basis, with the standard corporate income tax set at 30% on profits earned by companies. The Zambian kwacha (ZMW) is the reporting currency for all corporate tax liabilities. Assessment is conducted at the corporate level for both resident and non-resident entities generating Zambian-sourced income.
2025 Corporate Income Tax Rates
| Sector or Activity | Tax Rate (%) | Conditions/Comments |
|---|---|---|
| Standard corporate rate | 30% | Applicable to most companies |
| Hotels, lodges, accommodation, and food services | 30% | Increased from previous 15% |
| Mining operations (base metals, industrial minerals) | 30% | Includes both base metals and industrial minerals |
| Electronic communications networks/service licensees (Telecommunications sector) | 35% | Special regime for telecom industry |
| Farming sector | 10% | Applies to companies engaged in farming |
| Agro-processing | 10% | General rate for agro-processing businesses |
| Profits from export of non-traditional products & value addition to copper cathodes | 5% – 20% | Rate depends on specific activity (see below) |
| Profits from public-private partnership (PPP) projects by SPVs (first five years) | 15% | Applies to special purpose vehicles (SPVs) only |
| Export of non-traditional products from farming & agro-processing | 10% | Incentive for export-oriented activities |
| Value addition to gemstones via lapidary/jewellery | 25% | Lower rate to encourage value addition |
| Special Incentives (Time-Bound) | ||
| Income from cotton seed production/ginning (2024–2028) | 0% | Full exemption for qualifying income |
| Spinning of cotton/weaving of thread (2024–2034) | 0% | Exemption for a decade |
| Agro-processing of corn starch in Multi Facility Economic Zone (MFEZ) or Industrial Park | 0% (2023–2032) 5% (2033–2035) 2.5% (2036–2037) 10% (2037 onwards) |
Phased incentives as per investment period |
Understanding Zambia’s Sector-Specific Corporate Tax Incentives
Zambia’s targeted tax regime provides significant incentives for investment in specific sectors and activities, particularly in agriculture, agro-processing, and value addition industries. Lower rates or outright exemptions apply to cotton processing, corn starch production within designated economic zones, and export-oriented value chains.
Entities in the telecommunications sector face a notably higher effective tax rate (35%), underscoring the government’s policy focus on certain high-revenue sectors. Conversely, agriculture and agro-processing enjoy a considerable advantage with rates as low as 10%, dropping to 0% for qualifying activities over specified periods. Meanwhile, companies involved in value addition to gemstones or public-private partnership projects benefit from lower rates under outlined conditions.
Summary of Main Corporate Tax Rates in Zambia (2025)
| Activity/Sector | Corporate Tax Rate (ZMW, %) |
|---|---|
| Standard/General Companies | 30% |
| Telecommunications | 35% |
| Farming & Agro-processing | 10% |
| Value Addition (Gemstones) | 25% |
| PPP Projects (SPVs, 1st 5 years) | 15% |
| Special Export/Processing Incentives | 0%–10% |
| Hotels, Hospitality, Mining | 30% |
Key Notes on Basis of Assessment
Zambia’s corporate tax is assessed on corporate profits. The absence of official detailed brackets confirms the predominance of flat or sector-specific regimes rather than progressive schedules. Where no special reliefs or rates apply, the 30% headline rate serves as the baseline.
Pro Tips for Navigating Corporate Taxes in Zambia
- Confirm Sector Eligibility: Take time to determine whether any part of your business’s operations qualifies for reduced rates, especially in agriculture, export, or special economic zones.
- Monitor Effective Dates: Time-bound incentives can have a major impact—review start and end periods to avoid unexpected rate increases once an incentive term expires.
- Sector-Specific Compliance: Sectors like telecommunications have notably higher rates, so ensure corporate structuring and financial planning account for these distinctions.
- Stay Informed on Updates: Rate changes for specific industries, such as hospitality or mining, have occurred in recent years; monitor announcements from Zambia Revenue Authority or the Ministry of Finance.
- Exemptions Are Not Automatic: Formal approval may be required to access certain tax holidays or reduced rates. Early engagement with official guidance is essential.
Official Resources and Further Reading
Zambia’s corporate tax system emphasizes both a clear standard rate and substantial sector-tailored incentives and surcharges. Sectional rates can dramatically affect overall tax outlays, especially for agriculture and specialized industrial activities. When considering operations or investments in Zambia, aligning business structure with relevant sectoral policies and keeping up with regulatory timeframes will ensure fiscal efficiency and minimize surprises.