Angola – 2023 State Budget Law: highlight of tax measures
15/03/23
In brief
Law 2/23, of 13 March, approved the State Budget for 2023 (SB 2023). This diploma entered into force on the day of its publication.
In detail
Law 2/23, of 13 March, approved the State Budget for 2023 (SB 2023). This diploma entered into force on the day of its publication.
Among the various tax measures included in the diploma, we highlight the following:
VAT
New provisions introduced by the SB 2023
- Given the minimum number of refund requests made by taxpayers, the percentage of VAT revenue allocated to the refund account will be reduced from 25% to 20%;
- In 2022, all taxpayers working in the manufacturing industry were included in the standard VAT regime. In 2023, the standard VAT regime is mandatory only to those who had in the previous fiscal year a turnover or import operations exceeding Kz 10 000 000 (ten million);
- Taxpayers under the simplified VAT regime may request the refund of a VAT credit accumulated for more than 12 months; the refund is granted always in the form of a tax certificate, under the regulated terms;
- Taxpayers who change from the simplified VAT regime to the standard VAT regime must pay the tax at the rate of 7% on the receipts that they will obtain from invoices issued during the period in which they were included in that regime;
- The Angola Tax Authority (“AGT”) no longer has the prerogative to under any circumstances decide on the inclusion or exclusion of taxpayers from the obligation to captivate the tax, whenever justified by reasons of protection of public revenues;
- The provision determining the withholding at source, at the rate of 2.5%, of all receipts made via the automatic payment terminals is eliminated; this results from the rule having already been republished for about three fiscal years, without being applied.
Measures already included in the SB 2022 maintained in SB 2023
Exemption from VAT on the imports of goods to be gifted for philanthropic purposes or to mitigate the effects of natural calamities, namely, droughts, floods, storms, cyclones, earthquakes, pandemics and others of identical nature, provided that the respective purpose is duly recognized by the AGT;
The VAT rate of 7% for the provision of hotel and restaurant services subject to compliance with certain requirements;
Setting reduced rates for the importation and transmission of certain products (with the changes compared to 2022 that we highlight in the "News" section);
Definition of the concept of customs value as a taxable basis for VAT on imports;
Subjection, at a rate of 14%, of transmission of goods and provision of services carried out in connection with the exploitation of games of chance or social entertainment;
Determining the last working day of the month following that to which the operations relate as the limit for payment of VAT;
Setting the minimum and maximum turnover limits for the inclusion of taxpayers in the simplified VAT regime between 10 and 350 million Kwanzas, respectively;
Definition of specific rules for the simplified and non-subject regimes, with the exception of the news included in the corresponding section.
Customs Duties
Authorized Economic Operators, certified as Official Brokers and Forwarders, are granted the following benefits:
Reduction in the number of documental inspections;
Priority treatment if selected for physical and documental inspections;
Exemption from the presentation of guarantee in the transit processes.
The provisions of the SB 2022 are republished, namely with regard to goods for personal use and payment of customs debts in installments, as well as benefits for Authorized Economic Operators (regarding this last point, we refer to the News set out in the corresponding section).
Rates
The VAT and Customs duties rates, in Annexes I and II to the SB 2023 respectively, largely reproduce the the ones included in the SB 2022, but containing small differences in some products, such as:
VAT: Sunflower seeds, even crushed, whose tariff code is 1206.00.00 was taxed at the rate of 7% changed to 5%;
- Customs duties: Margarine, except liquid margarine - Others, of 30 kg, whose tariff code is 1517.90.00 was taxed at the rate of 50% changed to 30%.
Stamp Tax
Taxpayers, under the simplified and standard VAT regimes who carry out exempt operations (and not "exclusively exempt" transactions as stated in the SB 2022) are obliged in relation to these operations to pay Stamp Tax on the amounts collected at the rate of 7%, referring to item 23.3 of the table attached to the Stamp Tax Code.
In the specific case of the international passenger air transport services and the real estate leasing, the Stamp Tax on amounts collected (receipts) will be 1% according to the table attached to the Stamp Tax Code.
Corporate Income Tax
This law establishes that VAT not deducted within the deadline foreseen in the VAT Code is considered a non-deductible cost for the purpose of calculating the taxable income subject to Corporate Income Tax.
It also establishes that the Stamp Tax due on the receivable which is borne by taxpayers falling under the general or simplified VAT regimes who carry out exempt operations is considered a deductible cost for Corporate Income Tax purposes.
Personal Income Tax
Article 9(2) of the Personal Income Tax Code is suspended. The taxable income of Group C taxpayers whose turnover, in the financial year 2022, is equal to or less than Kz 10 000 000.00 (ten million Kwanzas), corresponds to the volume of sales of goods and services not subject to withholding tax, on which the rate of 6.5% will apply.
Regardless of the volume of invoicing, taxpayers in this group who have organized accounting, must follow the rules applicable to the calculation of the taxable income of taxpayers under the Corporate Income Tax regime, with the relevant adjustments.
Special Gaming Tax
The Law establishes some exceptional rules in relation to the general regime of gaming taxation for the year 2023, namely those summarized below.
Players earnings
For 2023, prizes equal to or less than Kz 200,000.00 (two hundred thousand kwanzas) in all types of games are exempt from Special Gaming Tax; the surplus is taxed at (i) 10% in betting and gaming on territory and online basis and (ii) 20% in social games on territory and online basis. This exemption does not apply to random matches for advertising promotions, raffle tickets, sweepstakes and contests.The diploma makes an exception for the case of social games for random combinations for advertising promotions, raffles, sweepstakes and contests, so it should be clarified whether the exception applies to the new defined rates or to the tax exemption.
Activity of the operators
On the gross income resulting exclusively from betting on social gambling related to sports, the rate of special gaming tax applied is: a) 20% on land based sports bets; b) 25% on online sports bets.
The tax on land based bench games is settled according to two installments, namely: a) The first installment resulting from the application of a rate of 1.1% on Initial Working Capital, in simple stalls and, 2.2 % in double stalls; b) The second installment resulting from the application of a rate of 25% on the gross revenue of the stalls.
The tax rate of 25% will apply on the non-benched land based or online games, including bingo games. The tax is levied on the gross revenue and commissions of the operating entities, for each of the tables and game sessions.
Tax on Inheritance and Donations of movable Property
The diploma replicates the taxation rates for Inheritance and Donation Tax provided for in the SB 2022 for free transfers of movable property, namely:
In transfers |
Percentage (%) |
|
Up to kz: 5 000 000,00 |
Morethan kz: 5 000 000,00 |
|
Between spouses or in favor of descendants and ascendants |
o,5% |
1% |
Any other natural person |
1% |
2% |
Motor Vehicle Tax Law
The diploma replicates the taxation rates on Motor Vehicle Tax provided for in the SB 2022, namely:
Table (Vessels)
Group |
Gross registered tonnage |
Propulsion Power (HP) |
Unit Value (Kz) |
1 |
Up to 2 |
From 250 to 50 |
125,000 |
More than 50 |
187,500 |
||
2 |
From 3 to 10 |
Up to 50 |
281,250 |
More than 50 |
393,750 |
||
3 |
From 11 to 30 |
Up to 100 |
511,875 |
More than 100 |
665,437.50 |
||
4 |
From 31 to 50 |
Up to 100 |
865,069 |
More than 100 |
1,124,589.50 |
||
5 |
From 51 to 70 |
Up to 100 |
1,461,966.50 |
More than 100 |
1,754,359.50 |
||
6 |
More Than 71 |
Up to 100 |
2,105,231.50 |
More than 100 |
2,526,278 |
Tables (Aircraft)
Group |
Gross registered tonnage |
Unit Value (Kz) |
1 |
Up to 600 |
250,000.00 |
2 |
More than 600 up to 1.000 |
344,340.00 |
3 |
More than 1.000 up to 1.400 |
469,325.00 |
4 |
More than 1.400 up to 1800 |
657,761.00 |
5 |
More than 1.800 up to 2.500 |
915,702.50 |
6 |
More than 2.500 up to 4.200 |
1,267,675.50 |
7 |
More than 4.200 up to 5.700 |
1,839,642.50 |
8 |
Mais de 5.700 up to 10.000 |
2,284,797.00 |
9 |
Mais de 10.000 up to 20.000 |
2,438,636.00 |
10 |
Mais de 20.000 |
2,573,342.00 |
© 2023 PwC. This communication is of an informative nature and intended for general purposes only. It does not address any particular person or entity nor does it relate to any specific situation or circumstance. PricewaterhouseCoopers Tax Services TLS, Lda. We will not accept any responsibility arising from reliance on information hereby transmitted, which is not intended to be a substitute for specific professional business advice.
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