AFRICA: Response to new OECD Pillar One Amount B report

Following the release of the OECD's latest transfer pricing report regarding Amount B of Pillar One, the African Tax Administration Forum ("ATAF") in a press release on 19 February 2024 announced that it will adopt a simplified approach to pricing marketing and distribution activities. The OECD report provides a simplified and streamlined approach to the application of the arm's length principle to qualifying transactions for in-scope baseline distributors.

However, the West African Tax Administration Forum ("WATAF") has expressed reservations concerning the OECD/G20 IF report. WATAF has recommended that members continue to use the OECD Transfer Pricing Guidelines alongside their domestic transfer pricing rules and the UN Practical Manual for Transfer Pricing until such time that the IF refines the report.

ANGOLA: Mandatory submission of annual declaration return forms for employment income tax stopped

The General Tax Administration ("AGT"), through a public statement issued on 8 February 2024, has stopped the mandatory submission of the annual declaration return form (Form 2) for employment income tax ("EIT"). The annual declaration of the EIT is to be automatically generated by the AGT system, based on the information contained in the payroll and withholding statements which are submitted monthly.

ANGOLA: National Assembly approves tax changes

Law No.14/23, which was approved by the National Assembly and became effective on 28 December 2023, introduces various tax changes, including:

Value added tax

  • Reducing the top rate of VAT on imports and transmission of widely consumed foodstuffs and agricultural inputs from 7% to 5%, and the VAT rate on transmission of goods subject to the special regime applicable to the Province of Cabinda from 2% to 1%;
  • Stipulating that the location of goods is considered to be Angola when the goods are sold via international e-commerce, and when the payer is situated within Angolan territory with VAT applicable;
  • Introducing VAT on gambling;
  • Exempting banks, insurance and telecoms companies from the obligation to withhold VAT on transactions between each other;
  • Allowing VAT deductions to be done within 12 months after issuing the invoice or receiving payment for import tax; and
  • Introducing a deferred payment of VAT for up to 12 months upon the request by the taxpayer.

Other changes approved by the Angola Assembly through the General State Budget for 2024 (OGE 2024), which became effective on 1 January 2024 include:

  • Introducing a special contribution on current invisible foreign exchange operations ("CEOCIC") for individuals and companies at the rates of 10% for corporate entities and 2.5% for individuals. Operators in the oil and gas or mineral resources sectors are exempt from the contribution;
  • Disallowing depreciation and amortisation costs of fixed assets resulting from revaluation as a deduction;
  • Increasing the threshold for employment income tax ("EIT") from AOA70 000 to AOA100 000; and
  • Introducing a requirement for all corporate income taxpayers to submit their declarations electronically.

BURKINA FASO: Voluntary health insurance to be implemented by employers

On 27 February 2024, the Council of Ministers adopted a decree outlining the conditions, procedures, and deadlines for the distribution, collection, and payment of contributions to the National Universal Health Insurance Fund (RAMU), the Universal Health Insurance Scheme in Burkina Faso.

Contributions will vary depending on the category of individuals. Retirees will contribute approximately 2% of their income, while both public and private sector employees will contribute 5%, with 2.5% to be contributed by the employer and 2.5% by the employee.

BURKINA FASO: Finance Law 2024 adopted by Parliament

The Finance Law No 042-2023/ALT was adopted by parliament on 15 December 2023 and promulgated by Decree No 2023-1803/PRES-TRANS on 28 December 2023. Significant amendments, which became effect on 1 January 2024, include:

Direct Taxation

  • Removing the obligation to provide proof of withholding tax for the deductibility of expenses subject to this levy;
  • Increasing the cash payment limit from CFA100 000 to F.CFA1-million for an expense to be deductible;
  • Removing the limit for deductibility of donations made to the State;
  • Removing the general rate of 20% withholding tax applicable to taxpayers under the undetermined tax regime. This rate applies now only to legal bodies other than public entities and parastatals;
  • Introducing a 5% withholding tax on payments to public entities and parastatals under the undetermined tax regime;
  • Introducing an exemption from withholding tax on public orders for taxpayers registered with the Large Enterprises Tax Department and to those exempted from income tax.

Indirect Taxation

  • Decreasing the tax rate on financial activities from 17% to 15%;
  • Introducing a specific tax on cement at the rate of CFA2 000 per ton of imported or locally sold cement;
  • Extending the exemption from VAT to sales and imports of cement subject to the specific tax on cement;
  • Exempting from VAT and custom duties construction materials intended for real estate development programs;
  • Extending the scope of the tax on telecommunications to enterprises promoting electronic money and money transfers:
  • Adjusting the consumption tax by extending the scope of the special contribution to enterprises' profits. The tax is levied at 2% on after-tax profits and applies also to enterprises exempted from income taxes; and
  • Reinstating reduced rates for real estate transfer fees in Ouagadougou and Bobo-Dioulasso, and up to 20 km around those cities. These rates are reduced by one third in regional capitals and by 50% in other municipalities.

Tax Administration

  • Modifying the frequency of declaration and payment of the specific tax on telecommunications from annually to monthly and adjusting the payment deadline from 20 days following the month of taxation to 15 days; and
  • Adjusting the deadline for payment of tourism tax from 20 days following the month of taxation to 15 days.

BURKINA FASO: Levy procedure of compulsory withholding tax on employee remuneration clarified

The Council of Ministers imposed a compulsory withholding tax on the remuneration of public officials and private sector workers through a decree adopted on 5 January 2024.

This decree introduces a compulsory levy of 1% on the net salaries of workers in the public and private sectors, and 25% on the incentives paid to the staff of ministries and institutions, including employees of state-owned companies and public establishments, for a period of 12 months.

In a memo adopted and published on 11 January 2024, the Minister of Economy, Finance and Foresight clarified that "public sector workers" include those on diplomatic missions, in consular posts abroad, the parliamentary or hospital civil service, state-owned public establishments and companies, development projects, and all branches of the State.

"Net salary" is defined as the sum of monthly credit after the deduction of social security contributions and the single tax on salaries and wages. Emoluments paid monthly by the abovementioned entities are considered as salary.

The 25% deduction on incentives applies exclusively to staff of ministries and institutions. Incentives include bonuses and other benefits not taken into account in the monthly salary and paid periodically to public officials.

Private sector employers may declare and remit the deductions made on remuneration paid to the General Directorate of Taxes within the same timeframe as the single tax on salaries and wages. For public sector employers, the deductions made must be remitted to the treasury of the Patriotic Support Fund by the 5th of the month following the month in which they were made.

BURKINA FASO: Mining Taxes and Royalties modified

In a decision published on 17 October 2023 through Decree No 2023-1454/PRES-TRANS/PM/MEMC/MEFP which amended Decree No 2021-0023/PRES/PM/MEMC/MINEFID of 23 January 2017, Burkina Faso has modified the rates of mining taxes and royalties (portant fixation des taxes et redevances minières).

Significant amendments to the rates of mining taxes and proportional royalties on mining operations, based on the turnover of the extracted products sold, include:

  • Rates of between 5% and 7% on the sale of gold, depending on the price of an ounce of gold set by London Metal Exchange (LME) (previously between 3% and 5%);
  • A rate of CFA100 per gram for the extraction of artisanal gold;
  • A rate of 5% for silver and manganese (previously 4%); and
  • A rate of 3% on zinc valued at USD2 000 or less per ton and for zinc valued at more than USD2 000 per ton, an additional 1% for each USD500 or fraction thereof.

BURKINA FASO: New electronic payment platform for tariffs launched

On 14 December 2023, Burkina Faso launched an online electronic payment platform for custom tariffs, called "eDouanes" (eCustoms). The new electronic platform, which provides for customs declarants and freight forwarders, users of banks, and users of the customs administration, aims to enable payments through modern, fast and secure means of payment.

BURKINA FASO: Tax stamps digitised

Burkina Faso has recently launched e-TIMBRE, a new platform for the administration of electronic stamps (e-stamps), aimed remedying the lack of physical tax stamps. The e-stamp is currently being implemented on a few pilot sites and will gradually be extended to all public services and on all the documents that require a stamp.

CABO VERDE: VAT Self-Invoicing Ordinance enacted and Guidelines published

Following the enactment of a VAT Self-Invoicing Ordinance through Law No. 56/2023, which came into effect on 1 January 2024, the Cabo Verde Tax Authority has recently released VAT Self-Invoicing Guidelines.

The self-invoicing Ordinance is designed to regulate the issuance of invoices by the purchaser of goods or services on behalf of the taxable supplier and applies to:

  • Entities with organised accounting obligations, encompassing public entities, organisms, international and non-governmental organisations, as well as small businesses acting as purchasers of goods and services; and
  • Taxpayers classified as microenterprises, functioning as sellers of goods or service providers.

CABO VERDE: 2024 Budget introduces various tax amendments

The 2024 Budget 2024 introduced various significant tax amendments, expected to come into effect on 1 January 2024, including:

Direct taxes

  • Reducing the corporate income tax rate from 22% to 21%;
  • Introducing a special taxation regime designed for groups of companies, allowing the transfer of tax losses incurred by a group company to another group member to reduce the overall tax bill. This process no longer requires the previous consent of Cabo Verdean tax authorities (Direcção Nacional de Receitas do Estado (DNRE));
  • Introducing a deduction mechanism for corporate income tax purposes under which an amount equivalent to the 10% rate on the eligible increase in equity (capped at CVE20-million) is deducted from the taxable profit. Increases in equity can be in the form of cash contributions, in-kind contributions, premiums from equity interest issuance and the allocation of accounting profits;
  • Allowing losses to be carried forward indefinitely (previously seven years). Tax loss utilisation continues to be capped at 50% of the taxable profit and the carry-back of tax losses remains impermissible;
  • Decreasing the corporate income tax credit, previously available for up to 50% of eligible investments in industrial activities, to 20%;
  • Extending the corporate income tax exemption under contractual agreements to beyond five years, if, subject to approval by the Council of Ministers, the agreement is declared by the government to be of exceptional interest and:
    • the investment amount exceeds CVE10-billion;
    • the investment creates at least 100 qualified jobs;
    • the investor undertakes obligations for the construction or renovation of infrastructure;
    • the investor assumes social and environmental responsibilities; and
    • the investor commits to promoting the dynamism of Cape Verdean companies and the creation of value chains;
  • Enacting a series of amendments enhancing the tax administration's authority in the realm of transfer pricing, including introducing a mandatory transactional net margin method (Método da Margem Líquida da Operação) for taxpayers providing short-term accommodation and related services. This method includes adding a fixed return rate to accommodation and related service expenses, as set by the National Directorate of State Revenues (Direcção Nacional de Receitas do Estado –(DNRE).

Indirect taxes

  • Implementing a self-invoicing system for VAT under which invoices prepared by the purchaser of goods or service must meet the following conditions:
    • the invoice must be based on a prior agreement between the taxable person transferring the goods or providing the services and the purchaser or recipient;
    • the purchaser must provide evidence that the supplier of the goods or services was informed of the invoice issuance and accepted its content; and
    • it must be issued in a specialised series of invoices, explicitly indicating the words "self-billing"; and
  • Introducing a comprehensive exemption from import duties and VAT on waste recycling, plastic and mineral extraction to foster private investments in sustainable practices.

CAMEROON: Commitment to start Automatic Exchange of Financial Account Information by 2026

According to a press release published by the OECD on 14 February 2024, Cameroon has committed to implement the international Standard for Automatic Exchange of Financial Account Information in Tax Matters ("AEOI") by September 2026

CAMEROON: Finance Law 2024 adopted

The Finance Law 2024, which was adopted on 19 December 2023 by Law No. 2023/019, introduces various significant tax changes. Unless otherwise indicated, the following provisions are effective from 1 January 2024:

  • Introducing a limitation of 1% on turnover for the deductibility of head office expenses for companies with continuous losses and new companies in a loss position. Where a company has no turnover yet, the limitation applies to the total expenses of the company;
  • Disallowing losses resulting from merger and acquisition transactions through restructuring in the event of a change in activities of the dissolved company;
  • Disallowing the deduction of expenses supported by invoices not issued through the tax administration's electronic invoice monitoring system, or invoices issued by non-registered taxpayers;
  • Allowing the deduction of losses arising from damaged goods, subject to the additional condition that the damage is not due to negligence or imprudence of the taxpayer;
  • Introducing country-by-country ("CbC") reporting for companies that:
    • are part of multinational groups established in Cameroon;
    • are required to file consolidated financial statements, or which would have been required to do so under the regulations of the Central African Stock Exchange; and
    • realised during the preceding fiscal year consolidated annual turnover excluding tax of at least XAF492-billion;
  • Broadening the personal income tax base to cover worldwide passive income of individuals;
  • Introducing a movable capital tax of 16.6% (i.e. 15% increased by the local council surcharge) on income from digital assets and a 5% non-commercial income tax on income generated by individuals through digital platforms;
  • Increasing the capital gains tax rate from 5% to 10% for the transfer of immovable property paid in cash;
  • Extending the list of entities required to withhold rental income tax and tax on payment to third parties to include non-profit organisations;
  • Removing the exemption from withholding tax on the local purchase of petroleum products granted to distributors registered in the Large Taxpayers' Office;
  • Adjusting the windfall income taxation base where the windfall income is above the income threshold subject to the highest personal income tax rate, to the sum of the net taxable income plus 75% of the windfall income;
  • Extending the estimated taxable value of benefits in kind calculated with reference to gross salary as follows: telephone (5%), fuel (5%), security guard (5%) and internet (5%);
  • Introducing an annual cap of XAF4.8-million (XAF400 000 per month) on the flat-rate deduction of 30% of the gross salary;

Indirect taxes

  • Extending the conditions for VAT deductibility to include:
    • issuance of the relevant invoices via the tax administration invoices tracking system;
    • issuance of VAT withholding certificates via the tax administration electronic system; and
    • registration of suppliers as active taxpayers at the time of invoicing;
  • Abolishing the VAT exemption for parboiled rice, fragrant rice, luxury fishes (ornamental fish, chill trout, salmon, cod, etc.);
  • Increasing the import duty rates on parboiled rice and fragrant rice from 5% to 20%;
  • reducing registration fees for the transfer of business assets from 15% to 10%, and registration fees for the transfer of property by associations recognised as being of public interest and religious organisations from 10% (urban developed properties) and 5% (other properties) to 1%;

Tax administration

  • Specifying the selected sectors to which the electronic invoice tracking system applies, as well as the scope of application of electronic certificates. This system will be used by the tax administration to monitor expense deductibility, VAT, withholding taxes and automobile stamp duties;
  • Authorising the Minister of Finance to designate certain entities to collect excise duties on minerals and income tax from companies engaged in semi artisanal mining;
  • Introducing an automatic transmission to the tax administration of internal audit reports and inventories listed at court registries;
  • Digitising tax clearance certificates and reinforcing their scope;
  • Introducing the automatic exchange of financial information as well as identification of beneficial owners of bank accounts;
  • Adjusting the deadline for filing annual financial statements and payment of outstanding income tax from 15 March to 15 April for taxpayers registered with the Medium-Sized Taxpayers Department and other Specialised Tax Departments and 5 May for taxpayers registered with the Small Taxpayers Department;
  • Increasing penalties on the failure to declare, failure to exchange information and failure to issue electronic invoices for companies subject to this obligation; and
  • Exempting from penalties the voluntary disclosure of taxpayers' assets located or income derived outside of Cameroon.

DEMOCRATIC REPUBLIC OF THE CONGO: Finance Act 23/054 passed

The Finance Act 23/054 containing measures for the 2024 financial year was recently passed. Unless otherwise indicated, the following amendments are effective from 1 January 2024:

Direct taxes

  • Extending the tax on bonuses and allowances to members of political institutions at a rate of 15%;
  • Imposing levies on the turnover of cyber security companies;

Indirect taxes

  • Introducing, at rates to be determined by inter-ministerial decrees:
    • A turnover levy on cybersecurity companies;
    • A levy on applications for authorisation to supply digital services;
    • A registration fee on small and medium-sized enterprises (SMEs), start-ups and artisans eligible for sub-contracting or public contracts;
    • A certification tax on artisanal and craft products;
    • A levy on franchise agreements signed between foreign multinationals and Congolese SMEs;

Administration

  • Revising the proportions in which advance payments of corporate income tax are made by increasing from 20% to 30% the corporate income paid in the previous tax year for the first two instalments and the remaining 20% for the third payment. The number of instalments has been reduced from four to three, due by 1 August, 1 October and 1 December;
  • Increasing the minimum monthly employment income tax from CDF2 000 to CDF2 500;
  • Exempting from tax bonuses granted for honorary distinctions to employees during their career;
  • Providing that the remuneration on which the exceptional tax on expatriate professional income is levied cannot be less than the statutory minimum wage in the national country of the expatriate;
  • Introducing penalties of:
    • between CDF20-million and CDF50-million for chartered accountants certifying annual financial statements found to be irregular or insincere;
    • between CDF100-million and CDF200-million for the non-certification of annual financial statements;
    • CDF1-million per day on banks involved in export transactions that:
      • fail to submit statements of export to the tax administration within 10 days following the month of export; or
      • fail to report any new bank account of individuals or companies engaged in export operations within 10 days following the month in which the account was opened;
    • Extending the deadline to submit the annual professional income tax return to 15 February (previously 15 January); and
    • Amending the deadline for the payment of the annual environmental tax to 15 June (previously 30 June) and the deadline for payment of the annual pollution tax to 15 July (previously 30 June).

DEMOCRATIC REPUBLIC OF THE CONGO: Global Forum on Transparency and Exchange of Information joined

According to an update published by the OECD on 1 December 2023, the DRC has become the 170th member of the Global Forum on Transparency and Exchange of Information for Tax Purposes and has committed to implement the international standards on transparency and exchange of financial account information with other members of the organisation upon request and on automatic basis.

Equatorial Guinea: Corporate income tax and dividends tax to be reduced to boost hydrocarbons development

The Ministry of Mines and Hydrocarbons of Equatorial Guinea has announced a series of measures to enhance the profitability and attractiveness of petroleum investments. The fiscal reforms, set to come into force in 2024, include reducing the corporate income tax from 35% to 25% and the dividends tax from 25% to 10%.

ESWATINI: Income Tax (Amendment) Act 2023 introduces various tax changes

The government of Eswatini has introduced several changes through the Income Tax (Amendment) Act 2023, published on 20 October 2023. Significant amendments include:

  • Reducing the corporate income tax rate from 27.5% to 25%;
  • Limiting the carry-forward of losses to five years;
  • Clarifying the definition of a permanent establishment to include:
    • the furnishing of services, including consulting services, rendered for an aggregate period of more than 30 days in any 12 months period;
    • agent permanent establishments where a person habitually concludes contracts and plays a principal role leading to the conclusion of contracts that are routinely concluded; and
    • stock agent permanent establishment where a person habitually maintains a stock of goods or merchandise in Eswatini from which that person regularly delivers goods or merchandise on behalf a non-resident;
  • Increasing the withholding tax charged on interest earned by non-resident companies from 10% to 15%;
  • Introducing a 10% final withholding tax on dividends and interest earned by residents from societal shares from a financial institution, unit trust company, building society or mutual loan society;
  • Increasing the branch profits tax imposed on repatriated income to neighbouring countries from 12.5% to 15%;
  • Introducing capital gains tax on the disposal of business assets;
  • Introducing a small business concession regime in terms of which a presumptive tax at a rate of 1.75% of annual turnover is to apply to small businesses with an annual turnover of less than SZL500 000, except businesses carrying on professional services and those receiving investment income;
  • Limiting the deductibility of interest expenses to 30% of tax earnings before interest, taxes, depreciation and amortization (EBITDA) in a year of assessment for any company that is a member of group of companies (excluding companies whose main business is banking or insurance);
  • Introducing transfer pricing rules based on the arm's length principle;
  • Reducing the initial allowance for plant and machinery from 50% to 30% of the cost;
  • Imposing tax on income received as gratuity or bonus by an employee on bona fide termination of employment contract;

Administration

  • Introducing various new penalties;
  • Clarifying the new appeals procedure in terms of which a new Revenue Appeals Tribunal is established to deal with appeals against decisions made by the tribunal to replace the current dispensation where appeals against revenue administration decisions are made to court;
  • Authorising the Commissioner to issue a binding general ruling for a particular period of time;
  • Extending the period for the payment of withholding tax on payments for rent and beneficiary trusts from within 15 days after payment to the 15th day of the next month following the date of payment; and
  • Requiring taxpayers to submit returns electronically.

The GAMBIA: 2024 Budget presented

The Minister of Finance and Economic Affairs has presented the 2024 Budget Speech on 8 December 2023. New tax measures, effective from 1 January 2024, include:

  • Introducing withholding tax at the rate of 15% (commercial use) and 8% (residential use) on rental income earned by ministries, departments, and agencies (MDAs) and other businesses categorized as large taxpayers;
  • Increasing the pool and betting tax on winnings from betting, gaming, lottery, prize competition and gambling from 10% to 30%; and
  • Introducing penalties for the late filing of returns.

Ghana: Implementation of VAT on electricity supplied to residential customers suspended

The Ministry of Finance has suspended the implementation of 15% VAT on residential consumption of electricity when such consumption is above the maximum consumption level specified for block charges for lifeline units from 1 January 2024. The suspension takes effect pending further engagements with key stakeholders.

The first schedule of the VAT Act 2013 (Act 870) exempts a supply to a dwelling of electricity up to the maximum consumption level specified for block charges of lifeline units from VAT. This means that any supply of electricity above the maximum level would generally not be exempt from VAT.

GHANA: Emissions Levy Act implemented

The Emissions Levy Act, 2023 (Act 1111), assented to by the President on 29 December 2023, became effective from 1 February 2024. The Act imposes a levy on carbon dioxide equivalent emissions from specific sectors and internal combustion engine vehicle emissions.

Vehicle owners are required to register for and pay the emissions levy exclusively on the ghana.gov platform. Motor vehicle owners would be required to show evidence of payment of the levy before the issuance of a road user certificate.

Carbon dioxide equivalent emissions by sectors such as construction, manufacturing, mining, oil and gas, electricity and heating are also subject to a levy of GHC100 per tonne of emissions per month. Persons subject to the emissions levy are required to file a return of the quantity of emissions and the levy payable for each month by the last working day of the month immediately following the month of the return.

GHANA: Tax Acts amendment became effective

Following the presidential assent on 29 December 2023, the VAT (Amendment) Act, 2023 (Act 1107), Excise duty (Amendment) (No.2) Act, 2023 (Act 1108), Stamp Duty (Amendment) Act, 2023 (Act 1109), Exemptions (Amendment) Act, 2023 (Act 1110) and Income Tax (Amendment) (No.2) Act, 2023 (Act 1111) have become effective. Significant amendments include:

Direct taxes

  • Revising the income tax rates for chargeable income of resident individuals by increasing the annual tax-free income threshold from GHC4 824 to GHC5 880;

Indirect taxes

  • Reducing the VAT rate applicable to commercial properties from 15% to 5%;
  • Introducing a flat rate tax of 5% on the rental of commercial properties other than commercial rental establishments and the supply of immovable property by an estate developer;
  • Extending the zero-rating of locally manufactured textiles and vehicles to 31 December 2025;
  • Introducing the zero-rating of locally manufactured sanitary towels;
  • Waiving tax on electric vehicles for public transportation;
  • Expanding ad valorem tax bands and increasing the specific rate of stamp duty; and

Administration

  • Introducing a simplified tax return for individuals in the informal sector under the Modified Taxation Scheme.

KENYA: Social Health Insurance Act implemented

The Social Health Insurance Act 2023, which was assented to by the President on 19 October 2023 and came into force on 22 November 2023, implemented the Social Health Insurance Fund ("SHIF") and established the Social Health Authority and a framework for managing social health insurance.

In terms of the Act every Kenyan household, non-Kenyan resident ordinarily residing in Kenya for a period exceeding 12 months, the national government and county governments are required to contribute to the SHIF at the following rates with effect from 1 July 2024:

  • 75% of gross salary for individuals deriving their income from salaried employment, monthly; and
  • 75% of annual income for individuals whose income is not derived from employment, annually;

Employers are required to:

  • deduct the contribution from the employee's remuneration;
  • remit contributions to the Authority by the 9th day of the following month; and
  • notify the Authority of any employment terminations within 30 days.

MALAWI: 2024/25 Budget Statement delivered

The Minister of Finance and Economic Affairs has delivered the 2024/2025 Budget Statement on 23 February 2024 in the National Assembly. Significant proposed amendments which, indicated otherwise, will enter into force on 1 April 2024 once the Bill is passed by the parliament and assented to by the President, include:

Direct taxes

  • Introducing an additional 10% corporate income tax on profits above MWK10-billion;
  • Introducing a 100% allowable deduction for monetary donations to disaster aid made through the Department of Disaster Management;
  • Introducing a 50% allowable deduction of the cost of supplying water;
  • Reducing the withholding tax rate on interest realised from investments of life assurance from 20% to 15%;
  • Reducing the withholding tax rate for mobile money agents from 20% to 1%;
  • Revising the Pay As You Earn (PAYE) rates as follows:
    • first MWK150 000 taxed at 0%;
    • next MWK350 000 taxed at 25%;
    • next MWK2 050 000 taxed at 30%; and
    • excess of MWK2 550 000 taxed at 35%; and
  • Taxing 50% of the value of data and airtime as a fringe benefit.

Administration

  • Introducing a mandatory requirement to issue tax invoices for both taxable and exempt VAT supplies;
  • Introducing a new electronic billing system to replace the electronic fiscal devices for VAT purposes;
  • Introducing the mandatory registration of the importers of services as taxable persons; and
  • Introducing a tax clearance certificate ("TCC") as a registration and renewal of industrial rebate licenses for manufacturers, miners and dealers in explosives.

MALI AND NIGER: Tax treaties with France denounced

According to Joint Statement No. 001 by the governments of Mali and Niger of 5 December 2023, both countries have decided to denounce their tax treaties with France, with the denunciations becoming effective within three months.

Mauritania: 2024 Draft Finance Law published

The Mauritanian Ministry of Economy and Finance (MoF) has published the draft Finance Law for 2024 (Projet de Loi de Finance, PLF) in November 2023. Significant amendments include:

  • Treating profits which are deemed to be distributed to permanent establishments in Mauritania under a contract for the supply of goods or services as profits distributed to reserves for foreign companies;
  • Replacing the term "associated enterprises" with "affiliated enterprises" for transfer pricing purposes in order to harmonize terminology;
  • Extending the transfer pricing documentation requirements to include domestic transactions between members of the same group of associated enterprises;
  • Amending the elements required for the minimum standard for country-by-country reporting by updating the threshold for consolidated annual turnover in Mauritanian currency equivalent to EUR750 million, which is now set at MRU25-billion;
  • Gradually introducing the online payment obligation for large companies. The turnover thresholds and/or sectors of activity to which this obligation applies will be defined by regulation; and
  • Introducing penalties for the late filing of transfer pricing tax returns.

Mauritius: Lists of jurisdictions for automatic exchange of financial account information updated

The Mauritius Revenue Authority recently published updated lists of participating and reportable jurisdictions for the purpose of the automatic exchange of financial account information under the CRS MCAA. The lists concern the relevant jurisdictions for the 2024 reporting year in respect of 2023 reportable accounts.

Mozambique: 2024 National Reconstruction Tax rates approved

The Ministry of Economy and Finance of Mozambique has approved the revised National Reconstruction Tax ("NRT") rates for 2024 by Ministerial Diploma number 153/2023 of 29 December 2023.

The NRT is due by individuals aged between 18 and 60 years, earning taxable income as defined by the Individual Income Tax Code (Código do Imposto sobre o Rendimento das Pessoas Singulares, IITC), who are residents in districts of the country that are not formal municipalities.

Mozambique: Temporary VAT exemption on sugar, cooking oil and soap industries ended

Through a public notice issued on 17 January 2024, the General Director of Taxes of Mozambique Tax Authority has confirmed the end of the temporary VAT exemption for the sugar, cooking oil and soap industries, which had been in effect until 31 December 2023.

NAMIBIA: 2024 Budget speech announces new tax measures

The Minister of Finance and Public Enterprises has presented the 2024 Budget Speech on 28 February 2024. Significant proposed amendments include:

Direct taxes

  • Reducing the non-mining corporate income tax rate from 32% to 31%, effective from 1 January 2024 and further from 31% to 30%, effective from 1 January 2025;
  • Reducing the corporate income tax rate from 32% to 20% for small and medium enterprises ("SME"), subject to a pre-defined annual turnover threshold;
  • Limiting the carry-forward of assessed losses to 10 years for companies operating in the natural resources sector and to five years for companies in the other sectors;
  • Replacing the thin capitalisation rules with a 30% limited net interest deduction rule;
  • Introducing a 10% dividend withholding tax on dividends declared to individuals with effect from 1 January 2026;
  • Removing the non-resident shareholders tax exemption on dividends declared by long-term and short-term insurance companies, effective during the 2024/2025 financial year;
  • Introducing a special economic zones ("SEZ") regime in which the SEZ participants will be subject to a reduced corporate income tax rate of 20% and VAT zero-rating;
  • Introducing an internship tax incentive programme that will provide an additional corporate tax deduction for employers employing interns;
  • Introducing a 10% capital allowance on improvements of buildings, effective during the 2024/2025 financial year;
  • Increasing the minimum tax threshold for individual taxpayers from NAD50 000 to NAD100 000 with effect from 1 March 2024;

Indirect taxes

  • Increasing the mandatory VAT registration threshold from NAD500 000 to NAD1-million;
  • Increasing the threshold for payment of transfer duties on properties from NAD600 000 to NAD1.1-million, effective during the 2024/2025 financial year;
  • Increasing the threshold for payment of transfer duties on properties to 8% from NAD2-million to NAD3.15-million, effective during the 2024/2025 financial year; and
  • Introducing a supertax transfer duty for properties costing more than NAD12-million; and

Administration

  • Introducing the e-invoicing system to improve the Namibia Revenue Agency's revenue collection ability.

Nigeria: Expatriate employment levy introduced

The federal government of Nigeria has introduced an expatriate employment levy ("EEL") on employers of expatriates in Nigeria at an annual rate of USD15 000 for directors and USD10 000 for other categories of expatriates payable annually.

The EEL will be applied mainly to the offshore earnings of expatriates in the construction, information, communication technology, agriculture, manufacturing, oil and gas, telecommunications, services, banking, finance, maritime and shipping, and healthcare sectors.

The EEL will become due when a foreign employee spends at least 183 days within a year in Nigeria. The failure to file an EEL return within 30 days attracts a fine of NGN3-million, while filing a false return, statement or representation attracts five years' imprisonment or a fine of NGN1-million, or both.

NIGERIA: New electronic platform for transfer pricing filings and country-by-country reporting obligations introduced

The Federal Inland Revenue Service (FIRS) has announced the migration from e-TP Plat to the TaxPro Max Platform for the filing of transfer pricing returns and country-by-country reporting obligations.

Affected taxpayers have until 30 June 2024 to fulfil their pending obligations on the TaxPro Max platform. Taxpayers who had filed their returns on the e-TP Plat can re-file returns on the TaxPro-Max platform.

Nigeria: Global tax review to address systemic imbalance advocated for

At the third South Summit of the Group of 77 and China in Kampala, Uganda, Nigeria advocated for a review of the global tax system to address the inequity and systemic imbalance in tax administration between countries, particularly in relation to the taxation of digital economies. It was noted that the current international tax system cannot guarantee fairness, especially for developing countries which have suffered significant revenue losses and may not achieve sustainable development and economic self-reliance.

Nigeria: Implementation of Guidelines on VAT Simplified Compliance Regime for non-resident suppliers of goods to Nigeria postponed

Through a publication on 14 January 2024, the FIRS has issued a notice postponing the implementation of the Guidelines on Simplified Compliance Regime on VAT for non-resident suppliers of low-value goods to Nigeria through digital platforms, which was due to commence on 1 January 2024.

The provisions of the Guidelines on Simplified Compliance Regime for VAT for Non-Resident Suppliers ("NRSs") of Goods, Services, or Intangibles to Persons in Nigeria through Electronic, Digital or Similar Platforms, which came into effect on 1 January 2022, are still valid and should be complied with by non-resident suppliers of services and intangibles.

Nigeria: Grant of tax exemption to 34 companies announced

The Nigeria Investment Promotion Commission has informed the public that it has granted tax exemption to 34 companies seeking tax waivers and incentives (Pioneer Status Incentives) under the Industrial Development Income Tax Act in 2023.

Nigeria: Notice for deduction and remittance of electronic money transfer levy on foreign currency transactions issued

The FIRS has issued a notice to banks, directing them to deduct and remit the sum of NGN50 as electronic money transfer levy ("EMTL") on every foreign currency transaction with an equivalent amount of at least NGN10 000. This levy is in line with the provisions of the Finance Act 2023 and Stamp Duty Act, which impose an EMTL on the transfer of money deposited in any financial institution on any type of account.

RWANDA: Public ruling clarifying application of new corporate income tax rate issued

The Rwanda Revenue Authority has issued a Public Ruling on 4 January 2024 to clarify the applicable computation method for the new corporate income tax rate of 28% (previously 30%) introduced by Law No. 051/2023 which entered into force on 14 September 2023. The Public Ruling requires taxpayers to apply the computation method as follows:

  • Computing and submitting their annual corporate income tax returns; and
  • Applying the pro rata computation method based on the date of 14 September 2024 when the law introducing the new corporate income tax rate was gazetted.

São Tomé and Príncipe: 2024 Budget published

The government has approved the 2024 Budget, which enacts a series of amendments to various tax laws. Unless otherwise indicated, the following amendments are to become effective on 1 February 2024:

Direct taxes

  • Increasing the minimum corporate income tax amount from STD2 400 to STD2 544;
  • Introducing a special tax on individual income (IERS)at a rate of 20% on monthly income exceeding STD50 000;
  • Allowing taxpayers to amortize the costs associated with acquiring invoicing software and related equipment within a single fiscal year;
  • Introducing a new rate band to the personal income tax rate table. Income exceeding STD420 000 is subject to tax at a rate of 30% with a deductible amount of STD45 048;

Indirect taxes and administration

  • Obliging taxpayers subject to corporate income tax and personal income tax with a turnover of at least STD1-million as well as those required to maintain organized accounts irrespective of turnover, to process all invoices issued within the scope of their economic activities with invoicing software; and
  • Establishing a maximum profit margin of 10% on VAT-exempt or zero-rated basic goods, including butane gas.

São Tomé and Príncipe: Guidance for individual taxpayers with business income published

The Tax Authority has issued two comprehensive guides (the IRS organised accounting (contabilidade organizada) guide and the IRS simplified bookkeeping guide) outlining a list of documents that resident and non-resident individuals subject to personal income tax under Category B (Business Income) and with a permanent establishment in São Tomé and Príncipe are obligated to declare to the Tax Authority. The declaration must be submitted in accordance with the terms and conditions stipulated in Act No. 11/2009, article 108 of the Personal Income Tax Code.

All items in the declaration must be presented in Portuguese. In addition, taxpayers are required to include various other annexes, including a trial balance, a fixed assets register, details of tax deductions, a calculation of taxable profit and a statement of the company's financial position for the previous five financial years.

For taxpayers under the simplified regime, the above-mentioned annexes are not required; they only need to submit simplified accounting documents (IRS - Model 1 - Annex B2).

Senegal: Country-by-country reporting implemented

The Finance Minister has issued an Implementing Order specifying the content and format requirements for country-by-country reporting ("CbCR") as outlined in article 31ter of the General Tax Code ("GTC").

Under the Order, the CbCR submissions must be made electronically and include financial and tax data of the group, such as turnover, income taxes paid and profit or loss before income taxes; and details of the group structure and the group's primary activities.

Senegal: Website for tax document requests launched

The Tax Administration, through Note no. 0171 MEFP/DGID/DGE/DGC of 31 January 2024, has launched a new website to simplify the application process for various tax requests, including tax certificates, tax domiciliation, tax clearances and certificates of payment of tax on petroleum products. Taxpayers can now conveniently apply for, track and access their documents online. The website also offers comprehensive document descriptions, requirements, and updates on the progress and processing times.

Senegal's Commitment to start the automatic exchange of financial account information by 2025

According to a press release published by the OECD on 4 January 2024, Senegal has committed to implement the international Standard for Automatic Exchange of Financial Account Information in Tax Matters ("AEOI") by September 2025. This commitment makes Senegal the 124th Global Forum member to commit to start AEOI by a specific date.

SEYCHELLES: Budget 2024 presented

The Seychelles National Budget 2024, presented by the Minister of Finance, National Planning and Trade on 3 November proposes the following significant tax amendments, expected to become effective on 1 January 2024:

  • Extending the loss carry-forward period for renewable energy businesses to 10 years;
  • Introducing a five-year tax holiday for new businesses in the priority sectors of the economy such as the blue economy, digital economy, and the manufacturing sector;
  • Increasing the deduction rate for donations by businesses towards community projects and programmes from 100% to 150%; and
  • Introducing a new tax system for the taxation of bonuses paid on the basis of annual performance and a partial exemption of pension contributions, as from 1 January 2024. The new tax system will provide for no tax on earnings equalling a month's salary; tax at the rate of 15% on any additional bonuses of up to 15% of the employee's annual salary; and tax at the rate of 20% on any additional bonuses.

SIERRA LEONE: Finance Act 2024 assented to

Following the proposals made in the 2024 Budget 2024, the President of Sierra Leone has given assent to the Finance Act 2024 which, unless otherwise indicated, come into operation on 1 January 2024. Significant amendments include:

  • Increasing the withholding tax rate on dividends, management/professional fees and lottery winnings from 10% to 15%;
  • Reducing the minimum alternate tax from 3% to 2%;
  • Introducing a tax on persons deriving income from the provision of digital products and services, whether resident or non-resident;
  • Introducing an education levy of 1%, which is to be added to the withholding tax rate for contractors, in addition to the 0.5% Free Health Levy introduced in the Finance Act 2016. Accordingly, the withholding tax rate for resident contractors is increased from 5.5% to 6.5% and the rate of non-resident contractors from 10.5% to 11.5%;
  • Increasing the goods and service tax ("GST") registration threshold from SLE100 000 to SLE500 000;
  • Exempting from GST of vegetable oil and machinery and plant for agricultural, manufacturing, mining, and petroleum operations; and
  • Reducing the stamp duty rate from 2% to 1% for conveyancers and other assignments of property.

ZAMBIA: Global Forum on Transparency and Exchange of Information joined

According to an update published by the OECD on 17 January 2024, Zambia has become the 171st member of the Global Forum on Transparency and Exchange of Information for Tax Purposes and committed to implement the international standards on transparency and exchange of financial account information with other members of the organization, upon request and on an automatic basis.

ZAMBIA: Amendments to tax laws enacted

The government of Zambia has enacted a series of amendments to various tax laws, through the Income Tax (Amendment) Act 2023, the VAT (Amendment) Act 2023, the Customs and Excise (Amendment) Act 2023 and the Zambia Revenue Authority (Amendment) Act 2023. These Acts received Presidential Assent on 22 December 2024 and are effective as from 1 January 2024. Significant amendments include:

Direct taxes

  • Increasing the tax concession for businesses in rural areas from one-seventh to one-fifth of the applicable corporate income tax rate for the first five years of operation;
  • Extending the accelerated depreciation of up to 100% in respect of any new implement, plant or machinery to a person operating a business in a priority sector and a developer in a special economic zone;
  • Introducing a five-year tax holiday on profits earned by local producers of cotton seed and cotton ginning and a 10-year tax holiday for companies earning profits from spinning of cotton and weaving of thread;
  • Introducing a 15% withholding tax on any excess income earned from a treasury bill or a similar government security issued at a discounted value;
  • Increasing the pay-as-you-earn ("PAYE") tax-exempt amount from ZMW57 600 to ZMW61 200 per month;
  • Reducing the PAYE top tax rate from 37.5% to 37% and adjusting the income tax bands accordingly;

Indirect taxes

  • Introducing an electronic invoicing system ("EIS") for VAT purposes, to be used by all taxpayers, including partnerships;
  • Introducing a levy of between ZMW0.08 and ZMW1.80 on the transaction value of mobile money transfers between individuals. The levy is paid by the sender of the electronic money and a mobile money service provider is responsible for collecting the levy during a person-to-person transfer. The levy does not apply to inter alia the payment of utility bills, payments to merchants and transfers from bank accounts;

Administration

  • Allowing mining companies to keep their books of account in USD if their gross income from mining operations in the form of foreign exchange earned outside Zambia is not less than 75%; and
  • Introducing a whistleblower's reward;

ZIMBABWE: Finance Act 2024 enacted

Following Budget 2024, which was presented on 30 November 2023, the Ministry of Finance has enacted the Finance Act 2024. Significant amendments which, unless otherwise stated, are effective from 1 January 2024, include:

Direct taxes

  • Increasing the corporate income tax rate from 24% to 25%;
  • Introducing a domestic minimum Top-up Tax ("DMTT") at a minimum corporate income tax rate of 15%;
  • Increasing the tax-free threshold for employment income from ZWL2.5-million to ZWL9-million;
  • Reducing the tax-free bonus threshold USD700 to USD400 or the ZWL equivalent;

Indirect taxes

  • Reducing the VAT registration threshold from USD40 000 to USD25 000; and
  • Introducing a wealth tax of 1% on the value of residential property (other than a primary residence) valued at USD250 000 or more;

Other measures proposed by the 2024 Budget include introducing a special capital gains tax ("CGT") of 20% on the disposal or transfer of mining titles (or interests therein) acquired in the preceding 10 years.

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