FAST-FOOD giant, Simbisa Brands Limited (Simbisa) paid close to US$1 million in fast-food tax during the first half of 2025, a levy it chose not to pass on to consumers despite pressure on margins.
\nThe tax, introduced on January 1, 2025, applies a 1% charge to all items legally defined as fast food as part of Treasury\u2019s revenue mobilisation measures.
\nSince Simbisa\u2019s financial year runs from July 1, 2024, to June 30, 2025, the new levy impacted its second-half results, forcing the group to absorb nearly US$1 million in additional costs.
\nThe tax comes amid growing complaints by formal businesses over heavy-handed taxation and enforcement, even as they account for only 23,9% of the economy, with the bulk being informal operators.
\n\u201cThe Zimbabwean operating environment saw the second half of the financial year characterised by a slowdown in economic growth and a significant shift in the local tax regime.
\n\u201cPleasing though, the market was able to deliver growth through disciplined pricing and customer-centric value offerings,\u201d Simbisa chairman Addington Chinake said in a statement attached to the group\u2019s financial year report for the period ended June 30, 2025.
\n\u201cOf note was the introduction of the 1% fast-food tax, levied on all items defined at law as fast food, which was effective January 1, 2025.
\n\u201cThis tax led to an erosion of margins. Simbisa made the conscious decision not to pass the \u2018food tax\u2019 onto our customers and, as a result, contributed to the fiscus by paying at least US$0,9 million in fast-food tax.\u201d
\nDespite the new tax, the group still posted a profit after tax increase of nearly 6% to US$16,91 million compared to the prior year.
\nThis was supported by a 7% rise in revenue to US$306,45 million compared to the 2024 period.
\nThe fast-food tax is particularly significant for Simbisa given that Zimbabwe accounted for nearly 71% of its operations during the review period.
\nThe local unit recorded revenue of US$216,09 million, while its regional business contributed US$90,35 million.
\n\u201cIn Zimbabwe, revenue grew 5% in FY 2025 versus prior year with customer counts up 7% year-on-year, supported by menu innovation and aggressive promotions, though margins were compressed by power shortages, higher operating costs and the absorption of the fast-food tax,\u201d Simbisa chief executive officer Basil Dionisio said.
\n\u201cThe region achieved 11% revenue growth despite a 6% decline in customer counts, as higher average spend and currency appreciation offset the impact of subdued consumer demand, political unrest and tax
\nreforms.\u201d
\nHe said organic growth was complemented by an expanded delivery footprint, with delivery volumes growing 42% in Zimbabwe and 33% in Kenya in FY 2025 versus prior year.
\n\u201cThis was primarily driven by the Dial-a-Delivery platform enhancements,
\nthird-party aggregator integrations and app-exclusive promotions and bundles,\u201d Dionisio said.
\nDuring the year, the group opened 47 new stores, refurbished 21 and closed 31 counters to end with 730 active counters, of which 604 are company-operated and 126 are franchised outlets.
\nSimbisa set aside US$18,58 million in capital expenditure commitments for the current year ending June 30, 2026, up from US$11,8 million the previous year.
\nThis will fund a new store pipeline of 61 outlets (net 58) across company-operated markets, with a strong focus on drive-thru formats, alongside an extensive refurbishment programme covering 39 outlets.
\n\u201cSimbisa Zimbabwe has 31 net new counters planned for FY 2026, with a strategic focus on drive-thru formats and delivery optimisation to enhance convenience and broaden reach.
\n\u2018Delivery currently contributes just 4% of total revenue, presenting significant headroom for growth,\u201d Dionisio said.
\n\u201cExpansion of delivery coverage from 66% to 80% of outlets by year-end, coupled with app-exclusive promotions, bundled offers and enhanced service standards will be key drivers of this growth.
\n\u201cSimbisa Zimbabwe is targeting a 15% delivery-segment contribution by the end of FY 2026.\u201d
\nHe said an additional 19 store refurbishments were planned for FY 2026 to continually modernise and refresh the existing
\nnetwork.
\n\u201cProfitability will be safeguarded through increased local sourcing and workforce optimisation initiatives designed to protect margins against inflationary pressures, together with an expanded pilot solar programme.\u201d
\nhttps:\/\/www.newsday.co.zw\/business\/article\/200046746\/simbisa-absorbs-us1m-fast-food-tax-to-shield-consumers<\/p>\n","protected":false},"excerpt":{"rendered":"
FAST-FOOD giant, Simbisa Brands Limited (Simbisa) paid close to US$1 million in fast-food tax during the first half of 2025, a levy it chose not to pass on to consumers despite pressure on margins. The tax, introduced on January 1, 2025, applies a 1% charge to all items legally defined as fast food as part […]<\/p>\n","protected":false},"author":1,"featured_media":463,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"footnotes":""},"categories":[15],"tags":[],"class_list":["post-3175","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-updates"],"_links":{"self":[{"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/posts\/3175","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3175"}],"version-history":[{"count":1,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/posts\/3175\/revisions"}],"predecessor-version":[{"id":3176,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/posts\/3175\/revisions\/3176"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=\/wp\/v2\/media\/463"}],"wp:attachment":[{"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3175"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3175"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ctrade.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3175"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}