More Africa NewsZambia plans to introduce a tax on Mobile Money transactions from 2024

October 5, 2023by myles0

Digital payment services are growing in Zambia. In 2022, mobile money transactions reached a value of 170 billion kwachas in the country compared to 95 billion kwachas in 2021.

The Zambian government is considering introducing a tax on mobile money transactions. The proposal was made last week by Situmbeko Musokotwane, Minister of Finance and National Planning, during the presentation of the 2024 national budget.

The proposed tax only applies to person-to-person transactions. It ranges from 8 ngwee ($0.0038) to 1.80 kwacha ($0.085), depending on the value of the transaction.

This proposal comes in a context of accelerated digital transformation marked by the rapid adoption of digital payment solutions. According to Felix Mutati, Minister of Technology and Science, Mobile Money transactions in Zambia reached 170 billion kwacha ($8 billion) in 2022. This represents significant growth from the 95 billion kwacha recorded in 2021.

Through this levy, the government wants to “  ensure that everyone contributes something, even if it is a little, to the provision of public services  ”. However, sector players believe that the measure will have harmful effects, particularly on the informal sector.

“  Introducing a tax on mobile money will mean people will pay more. For those on lower incomes, every ngwee counts, a lot of explanation is needed  ,” Postle Jumbe, president of the Alliance of Zambia Informal Economy Association (AZIEA), told local media.

Source: Agence Ecofin

Leave a Reply

Your email address will not be published. Required fields are marked *

© Copyright Extensia Ltd