Zambia’s 1% turnover tax adds new compliance framework for betting operators
Minimum Alternative Tax introduced under the 2025 Income Tax amendment set to affect companies with high turnover but low taxable profits, including sports betting operators.
Zambia.- Zambia has introduced a 1 per cent Minimum Alternative Tax (MAT) on annual turnover under the Income Tax (Amendment) Act No. 10 of 2025, a measure that will have implications for businesses operating in the country, including betting and gaming operators.
The tax was enacted in late 2025 and applies through Zambia’s tax framework from the 2026 charge year, requiring certain companies with high revenues but low taxable profits to pay at least 1 per cent of their annual turnover in tax if their calculated corporate income tax falls below that level.
The policy forms part of broader efforts by the Zambia Revenue Authority (ZRA) to broaden the tax base and limit situations where companies report minimal profits despite generating significant revenue.
The MAT applies broadly to companies and partnerships across sectors, rather than targeting a specific industry. However, betting and gaming operators are expected to fall under the rules if they are incorporated businesses and their calculated corporate income tax liability is lower than the turnover-based threshold.
This structure may be particularly relevant for sports betting operators, which often process large volumes of wagers but operate on relatively thin margins after payouts and operational costs.
Under the system, companies calculate corporate income tax in the normal way, but must pay the 1 per cent turnover-based MAT if it exceeds the standard tax liability, effectively creating a minimum tax floor tied to revenue rather than profit.
The MAT comes alongside other recent tax measures affecting the gambling sector. In 2025, Zambia introduced a 10 per cent excise duty on betting services, which must be collected and remitted to the Zambia Revenue Authority by betting operators.
