The Income Tax (Amendment) Bill, 2018

Parliamentary Period: 
Third Session of the Twelfth Assembly

The object of this Bill is to amend the Income Tax Act so as to—
(a) limit the deductibility of interest on debts owed by certain taxpayers
to thirty percent of tax earnings before interest, tax, depreciation and
(b) revise the Kwacha to United States dollar exchange rate to be used
in computing indexed losses and indexed capital allowances for
persons carrying out mining operations and keeping their books of
accounts in United States dollars;
(c) make mineral royalty non deductible for income tax purposes;
(d) require a business, towhich tax avoidance provisions of theAct apply,
to retain documents and other information relating to the business=
transactions for a period of ten years;
(e) authorise the Commissioner-General to appoint a taxpayer as an agent
to withhold turnover tax on payments made to suppliers of goods and
(f) introduce a presumptive tax on betting and gaming businesses;
(g) allow an assessment in respect of transfer pricing cases to be made
not more than ten years after the end of the charge year to which the
assessment relates;
(h) increase the maximum penalty that may be prescribed for noncompliance
with transfer pricing regulations to twenty-four million
Kwacha from three thousand Kwacha;
(i) introduce penalties for negligent, fraudulent orwilful submission of an
incorrect balance sheet, account or other document in respect of the
skills development levy under the SkillsDevelopment LevyAct, 2016;
(j) clarify that the income of a public benefit organisation is only exempt
fromincome tax if the public benefit organisation is approved for that
purpose by theMinister;
(k) revise the current turnover tax regime and introduce a flat rate of
four percent on businesses with a turnover of eight hundred thousand
Kwacha or below per annum;
(l) dispense with the classification of certain foreign earnings as income
originating from the export of non-traditional exports and provide for
a maximum tax rate of ten percent on income determined by the
Commissioner-General as originating fromthe export of non-traditional
products from farming or agro-processing;

(m) reduce the company income tax rate to fifteen percent
from thirty-five percent for companies that add value to
copper cathodes;
(n) increase the withholding tax rate on dividends, payment
or distribution of branch profits and payment of interest
to a non-resident to twenty percent from fifteen percent;
(o) provide formatters connected with, or incidental to, the

Bill Stage: 
First Reading
Second Reading
Committee Stage
Report Stage
Third Reading