The legal and tax database is expanding to its first Portuguese-speaking country: Angola.
In Angola, the Mining Act in force dates from 2011 (Law No. 31/11 of 23 September 2011). Gold is considered a strategic mineral. The mining royalty rate for this precious metal is 5%. The corporate income tax rate, set at 30% for other companies, is reduced to 25% for mining companies. From the Angolan tax system, it is possible to estimate the overall tax burden on a mining company. For a representative mine with an average grade (3g/t) and a gold price set at $1250/oz, the average effective tax rate (AETR) calculated is 58%.
Would you like to learn about the taxation of the mining sector in Africa and learn how to model rent sharing? During the confinement, Ferdi opens its training on mining taxation to 10 participants, free of charge, to allow you to make the most of this time, despite the difficult circumstances related to the Covid-19 epidemic.
This distance training will take place from 8 to 26 April 2020. It will require approximately 9 hours of work. In addition, you will benefit from a personalised follow-up by the various trainers. Submit your application before April 5, 2020! Only 10 places are available.
Updated tax data for 2019 are now available for Benin, Guinea and Kenya.
In Benin, the conditions for interest deductibility have been tightened by the Finance Act, 2019 (Act No. 2018-39 of 28 December 2018). In Guinea, the minimum turnover tax rate, which had been reduced to 1.5% in 2018, was restored to 3% (Act No. 2018-069 of 26 December 2018). In Kenya, mining taxation has not changed (Act No. 10 of 2018).
In Benin, the Finance Act, 2019, tightened the conditions for interest deductibility (Act No. 2018-39 of 28 December 2018). To be deductible from the corporate income tax base, interest paid to business partners now have to meet four conditions: (1) not exceed the amount of share capital, (2) not exceed 30% of income before tax, interest, depreciation and provisions, (3) not exceed the average BCEAO rate plus three points, and (4) be paid within five years.
In Guinea, the minimum turnover tax corresponds to 3% of company turnover. Compared to other French-speaking African countries, this rate is high, but the amount of the Guinean minimum tax is capped. The Finance Act, 2018, attempted to halve this rate and remove the maximum amount (Act No. 2017-059 of 12 December 2017). However, the Finance Act, 2019, cancelled this measure (Act No. 2018-069 of 26 December 2018). The rate of 3% is reinstated, as well as the minimum and maximum amounts. For medium-sized companies, the minimum tax cannot be less than 15 million Guinean francs, nor more than 45 million. For large companies, these amounts are increasing: the minimum tax cannot be less than 75 million Guinean francs, nor more than 100 million.