ZIMRA targets property landlords with new tax

Zimbabwe's tax authority, the Zimbabwe Revenue Authority (ZIMRA), has introduced a presumptive rental income tax targeting landlords with formal properties, as part of broader efforts to formalize the economy. The new rules impose a flat rate on rental income, potentially forcing tenants to disclose property owners, and apply to commercial and residential properties effective immediately, and are expected to generate significant revenue. The Financial Gazette reports that the move could expose widespread tax evasion in the property sector, as landlords have long evaded taxes on rental income, and the property sector is a major source of untaxed income. However, it risks triggering rent increases that shift the burden onto tenants, who may be required to report their landlords to authorities. The tax policy aims to increase revenue but may have unintended consequences for the rental market, exacerbating the housing affordability crisis and sparking controversy among property owners, and could lead to a decrease in rental supply, worsening the housing shortage, and is a controversial measure.