Fact Check: Is ZIMRA looking at taxing churches?

Claim: The Zimbabwe Revenue Authority (ZIMRA) is going to impose strict tax obligations on churches to help boost government revenues, according to local media reports of a decision by Treasury which is being circulated widely in WhatsApp groups.

Is this true or false?

Verdict: True

The Zimbabwe Revenue Authority (ZIMRA) posted a notice on December 11 2024 informing all churches about a stakeholder engagement scheduled for a date to be announced. The meeting seeks to address tax compliance across all applicable tax categories as part of the institution’s “commitment to transparency and compliance support”.

At least 85.3 percent of Zimbabwe’s population is categorised as Christians belonging to different denominations, according to the 2022 Housing and Population Census Report. There are thousands of Churches across the country with followers ranging from dozens of people to millions, and attending special prayer services on different days.

What is the Church income exempt from tax?

Income received or accrued from donations, tithes, offerings, or other contributions made by members or benefactors of the Church or its institutions are exempted from paying income tax.
Any income that does not arise from trade or investment activities conducted by or on behalf of the Church or its institutions are also exempted from paying tax.

What about the Taxable Church income?

Income derived from trading activities is subject to income tax and this includes but is not limited to:

Proceeds from the sale of Church literature, books, or music, revenue from the sale of Church-branded merchandise (e.g. apparel, anointing oils, artifacts, etc.)
Income from the sale of meals, clothing, or similar items and such sales may attract Value Added Tax (VAT) depending on the sales thresholds.