The Finance Act (No. 7) of 2025 has introduced far-reaching amendments to the Capital Gains Tax Act [Chapter 23:01], significantly reshaping Zimbabwe’s capital gains tax landscape. The reforms expand the scope of exemptions under section 10, while simultaneously introducing an entirely new charging mechanism through section 30C. Of particular note is the introduction of a targeted exemption for the disposal of shares in specified State-owned entities, alongside the imposition of a Special Capital Gains Tax on the transfer of shares or interests in land-holding entities, irrespective of whether such transactions are concluded within or outside Zimbabwe.

Amendment of Section 10 of Cap 23:01
The Capital gains Tax Act has been amended in section 10 (Exemptions from capital gains tax) by the insertion of the following paragraph which has added another exemption from CGT

Amounts received or accrued on the sale or disposal of any shares or marketable securities of any statutory corporation or state-owned or controlled company to any other company or entity not owned or controlled by the State, which company or entity must be specified by the Minister by Statutory instrument.

Section 51- New Section 30C
With effect from the year of assessment beginning on the 1^st of January 2026, the CGT Act [Chapter 23:01] has been amended by the insertion of the following after section 30B

30C Special Capital gains tax on transfer of shares or interest in land-holding entities

Definitions:
(a) Land holding entity– means any one of the following entities which at the date of the taxable transfer, holds title to any piece of land in Zimbabwe or to immoveable property in Zimbabwe
(b) Date of transfer– means the date when a share or interest in any landholding entity is transferred in virtue of any agreement or by law of the country where the taxable transaction took place.
(c) Controller- means a person other than a beneficial owner who, notwithstanding the formal arrangements for the exercise of control over the entity as specified in its constitutive document, exerts a significant or preponderant voice in the affairs of the entity;
(d) Share or interest- includes a share, stake, right or interest in any landholding entity

The amendment affects the following:
(a) A company or other business entity unless it is incorporated under Companies and Other Business Entities Act [Chapter 24:31] whether or not the majority of its members are citizens or ordinarily resident in Zimbabwe
(b) A company incorporated or domiciled outside Zimbabwe
(c) A locally incorporated subsidiary company of a holding company incorporated or domiciled outside Zimbabwe
(d) Any other entity whatsoever domiciled outside Zimbabwe that is capable by law of the country of its domicile, of holding title to land or other real right

The Finance Act introduces a Special Capital Gains Tax on the transfer of shares or interests in a land-holding entity. The tax is charged at a rate of 20% of the value of the transaction, whether the transfer is concluded within or outside Zimbabwe, and applies where the shares or interests are transferred to any entity, individual, or partnership, whether domiciled inside or outside Zimbabwe.

Due date – The payment of this tax becomes due and payable no later than thirty days after the date when the transfer of shares or interests occurs.

This is evidenced by an appropriate entry in the entity’s share register, or by any other means which, under the laws of Zimbabwe or of the country in which the taxable transaction occurred constitutes definitive proof that title to the shares or interests has been transferred

The amount is payable in United States Dollars or the equivalent in foreign currency at the international cross rate of exchange prevailing at the time of transfer.

If share/interest ownership is disputed in Zimbabwe courts, title is not valid unless the claimant provides a tax clearance certificate confirming payment of special capital gains tax for that transaction.

The introduction of section 30C marks a fundamental shift in the taxation of indirect transfers of land and immovable property in Zimbabwe, bringing both offshore and intra-group share disposals squarely within the capital gains tax framework. By imposing a 20% Special Capital Gains Tax, payable within thirty days of transfer and enforceable through restrictions on share register entries, the legislature has significantly tightened compliance obligations for both local and foreign investors. As a result, investors will now be required to carefully evaluate the tax implications of acquiring shares in land-holding entities, as such transactions may attract substantial capital gains tax exposure irrespective of where the transfer is effected.

For assistance on this or any other tax-related matter, please contact our Tax Practice Group on info@mmmlawfirm.co.zw