Congo: new tax measures enactedJanuary 29, 2013
The Democratic Republic of Congo (DRC) recently introduced major changes to its tax legislation through a series of ordinance laws enacted by the President.
The main provisions, which apply as of 1 January 2013 unless otherwise indicated, are summarized below.
- The standard business income tax rate is reduced from 40% to 35%.
- A 14% withholding tax is introduced on payments to non-resident persons with no permanent establishment (PE) in the DRC with respect to services rendered or used within the country.
- A new business income tax regime is introduced for micro-sized companies and small-sized companies as follows:
- Small-sized companies whose annual turnover does not exceed CDF80 million are subject to business income tax at the rate of 1% on their turnover derived from the sale of goods. A 2% rate applies on the turnover from the sale of services.
- Small-sized companies may opt to be subject to the standard business income tax rate before 1 February of the tax year. The option is irrevocable.
- Micro-sized companies, whose annual turnover does not exceed CDF10 million, are subject to a lump-sum tax of CDF50,000.
- The definition of PE applicable to non-resident legal entities is extended to non-resident individuals.
- The progressive employment income tax schedule (impôt sur les rémunérations) is amended as follows:
|Annual income (CDF)||Rate (%)|
|Up to 524,160||0|
|524,161 – 1,428,000||15.0|
|1,428,001 – 2,700,000||20.0|
|2,700,001 – 4,620,000||22.5|
|4,620,001 – 7,260,000||25.0|
|7,260,001 – 10,260,000||30.0|
|10,260,001 – 13,908,000||32.5|
|13,908,001 – 16,824,000||35.0|
|16,824,001 – 22,956,000||37.5|
- The VAT registration threshold is increased from CDF50 million to CDF80 million.
- The possibility to elect to be subject to VAT is introduced for individuals and companies whose annual turnover is less than CDF80 million.
- New customs tariffs on imports and exports of goods are introduced.
- An excise duties code is introduced.
- The indirect tax provisions apply as of 18 October 2012.
Mining tax regime
The mining fees, taxes, royalties and fines rates are revised.
The tax procedures law is amended as of 18 October 2012. The main change consists of lowering the rate of late-payment interest from 10% to 4% per month of delay.
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