africa Agriculture Angola development Economy FDI Government Tax

Angola private investment law ensures lower taxes

Approximate reading time: 3 minutes

Lower Taxes are among the benefits the national and foreign investors will enjoy with the coming into force of the New Law on Private Investment.

The New Law, passed Thursday  by National Assembly, divides the country into four zones (A, B, C and D).

Main priority goes to the investments in the sectors of education, technical and vocational training, higher education, scientific research and innovation.

Agriculture and agro-industry come second, followed by health services and reforestation, industry manufacturing of forest resources and forestry.

The list of priorities include the textile, clothing and shoe industries,  while hotels, tourism and leisure come sixth, construction, public works, telecommunications and information technology, airport and railway infrastructures (7th), production and distribution  of electricity (8th) basic sanitation, collection and treatment of solid waste.

As for investors in the Special Regime Zone A, which covers the province of Luanda, Benguela and Huíla headquarters and Lobito municipality, they will benefit from a reduction in tax of 50% i.e from two to 1%.

The Urban Property Tax (IPU) will remain at 25% for two years, while Industrial Tax (from group A and B) will be reduced from 30% to 24%, for two year period.

Regarding to private investment in Zone A, the provisional industrial tax was reduced by 20% for a period of two years, i.e. 1.60% contrary to the previous 2%.

The capital application, private investors will pay 11.25% of tax, in two years, against the previous 15%.

Special Zone B Regime, comprising the provinces of Bié, Bengo, Cuanza Norte, Cuanza Sul Huambo, Namibe and the other municipalities of Benguela and Huíla, the SISA tax drops from 2% to 0.50%.

The urban property tax for investors in this area will now be taxed at 12.50%, against 25% (50% reduction) for a period of four years, while the final settlement industrial tax goes from 30% to 9%.

Industrial tax rates were also reduced from 2% to 0.60% for a four-year period and the capital duty from 15% to 0.6%.

Zone C of special regime includes the border provinces of Cuando Cubango, Cunene, Lunda Norte, Lunda Sul, Moxico, Uíge, Zaire and Malanje.

In this zone, the SISA tax rate for investors in this area will stand at 0.30%, against the previous 2%.

The Investors will pay 6.25% of urban property tax, against 25% (reduction by 75%), in eight year period, while the industrial tax rate final settlement is 6% against the 30% previously charged (reduction by 80%).

The capital duty goes from 15% to 3% over a period of eight years.

The province of Cabinda, in this special regime is integrated into Zone D, with SISA fixed at 0.15%, against the 2% previously taxed.

The investors will pay 3.125% of urban property tax, against the previous 25%.

The final industrial tax dropped from 30% to 3% over a period of eight years, while the provisional tax is 0.20% compared to 2%, while the capital duty goes from 15% to 1.50% .

Under the law, private investor should hire Angolan staff providing professional training and ensuring social and payment conditions, accordingly with their professional skill, without discrimination.

Source: Angop

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