Government has announced a wave of new tax proposals targeting alcohol, betting, cigarettes, sugary drinks, and investment earnings, as part of efforts to raise domestic revenue for its K33.6 billion supplementary budget for 2025.
Finance and National Planning Minister Dr Situmbeko Musokotwane presented the proposals to Parliament on last week, alongside Supplementary Estimates No. 1 of 2025. He stated that the measures are intended to strengthen domestic resource mobilization without resorting to excessive borrowing. Today, he expanded the supplementary estimates before parliament.
Among the standout proposals is a plan to increase excise duty on spirits and wines from 60% to 80%, and to revoke the current 40% excise duty suspension on clear alcohol, replacing it with a 50% excise duty. In addition, excise duty on cigarettes will rise from K452 to K750 per 1,000 sticks.
The betting industry, which has seen rapid growth in recent years, will now face a new 10% excise duty on betting services, as government seeks to formalize and tax the sector more aggressively.
Soft drink importations are also targeted, with a proposal to double excise duty on non-alcoholic and sugary beverages from K1 to K2 per litre.
Investors in government bonds are not spared, as the Finance Ministry plans to raise the withholding tax on interest from government securities from 15% to 20%, potentially affecting returns for both individuals and institutions.
Dr Musokotwane told Parliament that the new measures are expected to contribute K3.9 billion in additional revenue, while another K1 billion will come from regulatory levies collected by agencies such as the Energy Regulation Board, Civil Aviation Authority, and others.
The supplementary budget itself prioritizes allocations for fuel arrears (K11 billion), debt servicing (K8.5 billion), agriculture (K6 billion), and social services including education infrastructure and cash transfers.
Parliament today heard the supplementary estimates through the Expanded Planning and Budgeting Committee. These adjustments are expected to take effect this new month of July.
By Dingindaba Jonah Buyoya
