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Africa Tax Update in Brief

South Africa
Multinationals are continuing to seek out favourable jursidictions for investment purposes, and many eyes are trained on Africa. Taxand South Africa summarises the key tax updates throughout the continent.
Country Topic  
Benin Double Tax Agreement with the United Arab Emirates (UAE)

The UAE's Minister of Finance has signed 2 agreements for the avoidance of double taxation on income and protection of investments with the Republic of Benin in March 2013.

Botswana New Botswana Unified Revenue Service (BURS) Electronic Transfer Payment system

The BURS introduced a new Electronic Transfer Payment system, the Botswana Interbank Settlement System (BISS), with effect from 15 March 2013.

Whereas the previous system only allowed access by a few selected banks, transfers can now be made from any bank to the Bank of Botswana bank account.

Taxpayers are to generate an Online Reference Number (ORN) for transferring the funds with reference to their Taxpayer Identification Number (TIN), Tax type code and Tax period.

Gabon Amendments to General Tax Code (GTC)

The Finance Act 2013 enacted the following amendments to the General Tax Code (GTC):

  • Reduction in the corporate income tax rate from 35% to 30%. The corporate income tax rate for companies engaged in Oil & Gas and mining remains at 35%

  • Limitation of income tax deductions in respect of head office expenses, consultancy fees, technical assistance in finance or accounting, commission & fees, interest & other financial payments and debts, deposits & guarantees to 10% of chargeable income before taking into account these expenses

  • Reduction in VAT registration threshold to 60 000 000 FCFA (US$120 000)

Ghana 2013 Budget

The recently published 2013 budget statement and economic policy announced:

  • The reintroduction of a Windfall Profit Tax Bill for consideration by Parliament after due consultation with relevant stakeholders

  • A review of the withholding tax rate on management and technical fees and VAT on imported services

  • Strengthening of existing transfer pricing legislation and establishing a special unit within the Ghana Revenue Authorities to deal with the taxation of multi-national companies

  • A proposed increase in the VAT registration threshold from an annual turnover of GHS90 000 to GHS120 000

Lesotho OECD Membership

The Kingdom of Lesotho has joined the Global Forum on Transparency and Exchange of Information for Tax Purposes. As the 120th member of the Global Forum, it will participate in the peer review process which encourages all countries to adopt effective exchange of information in tax matters.

Since 2010 the Global Forum has published 88 peer review reports containing 616 recommendations to help jurisdictions improve their co-operation in tax matters.

Kenya Compulsory tax filing for individuals

In terms of Finance Act 2012, all individuals are required to file Self Assessment Tax Returns with effect from 1 July 2013. This includes individuals who receive only employment income.

Since June 2011, only individuals who received taxable income other than employment income were obliged to submit tax returns.

The tax returns are due for submission to the Kenya Revenue Authority (KRA) by 30 June following the tax year.

Kenya E-receipt enforcement

The KRA, in a March notice, announced that it will be taking legal action against registered Value Added Tax (VAT) traders who do not issue electronic tax register (ETR) receipts. The public has a legal obligation to demand an ETR receipt upon purchase of goods or services from registered VAT taxpayers.

The VAT Act and ETR regulations impose heavy penalties, including seizure and forfeiture of goods if payment of the VAT on such goods is not substantiated by an ETR receipt.

Uganda E-stamp services extended

Following the February rollout of the service, electronic stamp certificates can now be acquired at all Uganda Revenue Authority (URA) Domestic Tax (DT) offices countrywide. After the service was launched in October 2012, it was initially only available in the Kampala DT offices.

The certificates are issued after payment of stamp duty fees, hence legalising documents. A stamp certificate is instantly issued when the stamp duty bank payment notification is received by the URA.


Your Taxand contacts for further queries are:
Peter Dachs
T. +27 21 410 6620
E. pdachs@ens.co.za

Celia Becker
E. cbecker@ens.co.za

Taxand's Take


Multinationals who operate within these African countries, or are thinking of investing into Africa, should research all legislation, including tax legislation, in order to keep afresh of all developments. With more and more companies looking to expand into the continent, the need for increased regulation becomes greater therefore legislation will continue to be updated.

Taxand's Take Author

Peter Dachs
South Africa
Sub-Saharan Africa