KEY POINTS
- Zimbabwe and Switzerland signed a deal to avoid double taxation.
- The agreement aims to foster investment and improve the tax environment.
- Swiss companies like Nestlé will benefit from the favorable tax regime.
Zimbabwe and the Swiss Confederation have strengthened their business ties by signing a deal aimed at reducing the cost of doing business and fostering investment.
The agreement, signed on Wednesday, is designed to prevent double taxation on income and capital gains and curb tax evasion.
Swiss Ambassador to Zimbabwe, Stefan Rey, expressed confidence in the deal due to its power to draw investors.
The agreement serves to defend taxpaying rights so investors operating between both nations stay protected from double taxation.
According to ZBC News, Rey also pointed out that this is a clear sign of the growing bilateral cooperation between the two nations.
Swiss companies to benefit from favorable tax regime
As Swiss-based companies continue to expand their operations in Zimbabwe, the newly signed tax agreement will provide a more favorable tax environment.
This includes companies like Nestlé, which has been committing more funds toward growth in Zimbabwe, as well as Syngenta, Bata Shoe Company, Organic Africa, and Schindler.
Zimbabwe’s Minister of Finance, Mthuli Ncube, explained that the agreement is focused on eliminating double taxation and promoting tax cooperation.
Additionally, this is expected to foster increased collaboration, help prevent tax evasion, and enhance cross-border trade between the two nations.
It aims to create a more transparent and equitable environment for businesses, making Zimbabwe an even more attractive investment destination.
Increased foreign investment expected in Zimbabwe
In recent years, Zimbabwe has seen a surge in foreign direct investment, particularly from Swiss Confederation-based companies.
Nestlé has played a significant role in this growth, with more investment flowing into Zimbabwe’s agriculture and food sectors.
Moreover, the new agreement is seen as a critical step in further deepening business ties. This will contribute to the country’s long-term economic growth.
The tax agreement between Zimbabwe and Switzerland is expected to streamline business operations for foreign investors.
This is particularly in sectors like manufacturing, agriculture, and services, making it easier for companies to operate in Zimbabwe without the fear of being taxed twice on their profits.
