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26 Sep 2025
BY Celia Becker

Africa tax in brief

BOTSWANA: Value Added Tax Amendment Bill passed by the parliament

The Value Added Tax (Amendment) Bill, No. 22 of 2025, aimed at expanding the value added tax (“VAT”) base and modernising the VAT system by aligning it with international best practices, was passed by the parliament on 16 August 2025. Its effective date is yet to be announced.

A significant proposed amendment is the introduction of VAT on remote services supplied by non-residents to residents of Botswana via electronic networks. The Bill proposes several amendments and rules for the implementation of the taxation of such services, including:

• Defining "remote services" to mean services supplied where there is no necessary connection between the physical location of the supplier and the recipient of the service. This excludes the provision of an accredited degree or diploma programme;
• Defining a "large, unregistered person" to mean a person that is not a registered person or government entity making supplies with a total annual value in excess of BWP1-million;
• Defining "electronic fiscal devices" as devices for recording and transmitting sales and related data, and the issuing of invoices and receipts, including a virtual fiscal device;
• Defining an "electronic marketplace" to mean a marketplace that is operated by electronic means through which the underlying supplier makes a supply of remote services through the operator of the marketplace to the recipient of the supply, which includes a website, Internet portal, gateway, store, distribution platform, or other similar marketplace or platform, but does not include a marketplace that solely processes payments;
• Revising the definition of "invoice" to include any document in an electronic format stating an obligation to make a payment;
• Introducing the reverse-charge supply rule, where a VAT-registered person in Botswana, a large, unregistered person or a government entity is required to account for and pay VAT on the taxable remote services received from non-residents through an electronic market place;
• Clarifying that the time of a reverse-charged supply is the time that the services are provided and the value of the supply is the fair market value of the services at the time of the supply;
• Specifying that a supply of remote services by non-residents delivered through an electronic marketplace to a resident in Botswana who is neither VAT registered, a government entity, or a large, unregistered person, and who is not required to account for VAT under the reverse charge mechanism, shall be deemed to occur in Botswana, if the service:
  • is physically performed in Botswana by a person that is in Botswana at the time of the supply;
  • relates to immovable property in Botswana;
  • is a remote service supplied to a person that is resident in Botswana;
  • is an inbound tourism product, agency, or booking service. Inbound tourism product means accommodation, meals, transportation, tours, or other tourist activities provided in Botswana;
  • is a telecommunications service that can be used only in Botswana; or
  • is a telecommunications service supplied to a person resident in Botswana;
• Specifying that a recipient of a remote service will only be treated as a resident of Botswana where at least two of the following factors exist to support their residence:
  • the recipient's billing address;
  • the Internet protocol address of the device used by the recipient or any other geo-location method;
  • the recipient's bank account details, including the account the recipient uses for payment or the billing address held by the bank;
  • the mobile country code of the international mobile;
  • the subscriber identity (IMSI) stored on the subscriber identity module (SIM) used by the recipient;
  • the location of the recipient's fixed land line through which the service is supplied to the recipient; or
  • any other relevant information;
• Requiring non-resident suppliers of taxable remote services to register for VAT in Botswana if:
  • at the end of any 12-month period (or shorter period), the person made taxable supplies of a value exceeding BWP500 000; or
  • at the beginning of any 12-month period, there are reasonable grounds to expect that the total value of taxable supplies to be made by the person during that period will exceed BWP500 000;
• Allowing only registered persons carrying on a taxable activity through a fixed place of business in Botswana to claim an input tax credit in relation to the making of taxable supplies;
• Clarifying that the tax periods for the government entity or a large, unregistered person liable for reverse charge VAT will be two calendar months, while that for the non-resident suppliers of remote services will be three months ending on 31 March, 30 June, 30 September, and 31 December of each calendar year;
• Requiring non-resident suppliers of remote services to maintain VAT documentation;
• Requiring a registered person receiving a supply of remote services from a person without a fixed place of business in Botswana to notify the supplier that he or she is a registered person;
• Requiring a non-resident supplier of remote services that is required to register for VAT, but does not carry on a taxable activity through a fixed place of business in Botswana and is unable to comply with their obligations to:
  • appoint a VAT representative that would be liable for their VAT obligations; or
  • lodge security for payment of VAT with the Commissioner General of Botswana Unified Revenue Service (BURS);
• Allowing registered suppliers of remote services that have overpaid or underpaid tax to correct the discrepancy in their subsequent returns;
• Requiring registered persons making taxable supplies to issue fiscal receipts or invoices using an electronic fiscal device, failure of which leads to a minimum penalty of BWP10 000 per month and a maximum of BWP100 000 or a term of two years imprisonment, or both; and
• Permitting remote service suppliers to report and pay VAT in USD, EUR, GBP, or any other foreign currency as may be approved by the Commissioner.

BURKINA FASO: Amending Finance Law 2025 adopted

The Council of Ministers of Burkina Faso has adopted the preliminary draft of the 2025 amending state Budget introducing new tax measures and expanding exemptions to support key sectors. Significant proposed measures include:

• Exempting fish feed from VAT to support the agricultural, pastoral and fishing sectors; and
• Introducing a new tax on undeveloped land of between F.CFA750 and F.CFA1 000 per square meter depending on the location, and subject to an annual 20% increment.

The draft Budget will be submitted to the parliament for approval.

CAMEROON: Tax Treaty with Czech Republic enters into force

On 7 July 2025, the Cameroon - Czech Republic Income Tax Treaty (2023) entered into force and generally applies from 1 January 2026 for withholding and other taxes.

CôTE D’IVOIRE: Investment Protection Agreement with Singapore enters into force

On 26 August 2025, the Ivory Coast - Singapore Investment Protection Agreement (2014), signed in Singapore on 27 August 2014, entered into force. The agreement shall be valid for 15 years and shall continue to be in force unless either country decides to terminate it.

DEMOCRATIC REPUBLIC OF THE CONGO: Employer contribution rate to National Employment Office increased

Under Ministerial Order No. 0/CAB.MIN/ETAT/EM/ADJ/8/2025 of August 2025 amending Ministerial Order No. 095/CAB.MIN/ETAT/EM/PS/01/2018 of 17 August 2018, the Ministry of Employment and Labour has increased the employer contribution rate payable to the National Employment Office (ONEM) from 0.2% to 0.5% of employees' monthly remuneration.

The measure enters into force upon signature of the Ministerial Order.

ETHIOPIA: VAT registration obligations for taxpayers clarified

The Ministry of Finance, through the Registration for VAT Directive No. 1104/2025, issued on and effective from 2 September 2025, has clarified that the following categories of taxpayers obliged to register for VAT must complete their registration within 30 days from the Directive's effective date:

• Category A taxpayers whose aggregate turnover from taxable and exempt transactions exceeds ETB2-million;
• Taxpayers that are obligated to maintain books of account; and
• Taxpayers that voluntarily maintain books of account.

In addition, the Directive requires such taxpayers to begin collecting VAT on taxable goods and services they supply to the market from the date of their registration.

This clarification follows the repeal of VAT Proclamation No. 285/2002, which was replaced by VAT Proclamation No. 1341/2024.

MAURITANIA: 2025 Supplementary Finance Law enacted

The Mauritanian Parliament has approved, and the Presidency has promulgated, the Supplementary Finance Law for the 2025 fiscal year. Significant fiscal provisions introduced by the law include:

• Introducing a new carbon tax targeting mining sector operations. Under the new provision, mining companies will be subject to a carbon tax calculated on their greenhouse gas emissions;
• Repealing the carbon tax on butane gas in order to encourage greater adoption of butane as a safer and less polluting domestic fuel alternative, consistent with the government's environmental and public health objectives; and
• Introducing a new sector-specific training levy requiring mining companies to contribute 1% of their annual net profit, calculated after corporate income tax, to support national training initiatives. The proceeds will be allocated to capacity-building programmes, particularly in technical and administrative domains relevant to the extractive industry.

The law has been in force since 26 August 2025.

MAURITIUS: New VAT Regulations on digital and electronic services implemented

The Finance Act, 2025, which was enacted on 9 August 2025, introduces a new framework for the VAT treatment of digital and electronic services supplied by foreign suppliers with effect from 1 January 2026.

These changes are reflected in the updated tenth schedule of the VAT Act, which now includes part III, specifically addressing the scope and compliance obligations for such services.

• Under part III of the VAT Act, digitally or electronically supplied services are defined to include the supply of:
  • images or texts such as photographs, screensavers, electronic books and other digitised documents;
  • music, films, television shows, games and programmes on demand;
  • applications, software and software maintenance;
  • website supply and web hosting services;
  • advertising space on websites and online magazines; and
  • remote maintenance of software and equipment;
• Section 2 of the VAT Act defines a “digital or electronic service” as a service listed under part III that is either supplied by a foreign supplier over the Internet or an electronic network reliant on the Internet or is dependent on information technology for its supply. A “foreign supplier” is defined as any person who has no permanent establishment in Mauritius or resides outside Mauritius and supplies digital or electronic services in the course of business to a person in Mauritius;
• Under the newly inserted section 14A, VAT is chargeable on digital and electronic services supplied by foreign suppliers to recipients in Mauritius;
• Foreign suppliers are required to appoint a tax representative with a permanent establishment in Mauritius. This representative is responsible for submitting VAT returns, remitting VAT payments and fulfilling all obligations under the VAT Act;
• To determine whether a recipient is located in Mauritius, the foreign supplier must rely on at least two non-contradictory indicators, such as the billing address, the location of the bank from which payment originates, the IP address or geolocation of the device used, the international country code provided in contact details or any other commercially relevant information;
• The supply of digital or electronic services by a foreign supplier is subject to compulsory VAT registration, regardless of the supplier's turnover. For example, a foreign supplier making taxable supplies of MUR1 000 to a person in Mauritius is required to register and charge VAT at the standard rate of 15%; and
• Foreign suppliers are not required to issue VAT invoices for such supplies, and input tax cannot be claimed on these transactions. Additionally, foreign suppliers are not required to submit detailed lists of taxable supplies showing invoice numbers and values. However, under section 22(1E), they must electronically submit a list of taxable supplies made to persons in Mauritius, in a format determined by the Director-General.

MAURITIUS: Mandatory transfer pricing documentation measures enacted

The Finance Act, 2025 has introduced a number of indirect measures and reinforcements that impact transfer pricing compliance and related-party transactions. Significant amendments include:

• Introducing a requirement for companies to maintain proper documentation in respect of related-party transactions. However, "proper documentation" is not defined and no safe harbour thresholds for entities that may be exempt from this requirement are prescribed;
• Providing a formal definition of related parties, which now explicitly includes transactions between domestic entities and broadens the scope of transfer pricing compliance beyond cross-border dealings; and
• No details on the modalities for submitting documentation and complying with the new requirements. The Finance Act, 2025 does not outline the format, timing, or platform for submission.

While the Finance Act, 2025 does not establish a comprehensive transfer pricing regime, it signals a shift toward greater regulatory oversight of related-party transactions. The inclusion of documentation requirements and a broader definition of related parties suggests that further developments may follow through subsidiary regulations.

NIGER: Tax treatment of disbursements under certified electronic invoicing system clarified

The Directorate General of Taxes (DGI) of Niger has issued DGI Circular No. 00066/ME/F/DGI/CAB of 2 September 2025, which provides guidance on the treatment of disbursements (débours) under the Certified Electronic Invoicing System (SEeCF) in order to address inconsistencies observed in the invoicing of such transactions by taxable persons. The Circular is effective from the date of its signature and provides that:

• Disbursements are defined as sums advanced by suppliers on behalf of clients in order to cover expenses such as administrative fees, transport fees, court fees, or similar expenses. Such amounts reimbursed by clients without profit mark-up, must not be included in suppliers’ turnover and are excluded from the taxable base for VAT;
• In respect of disbursement reimbursement invoices:
  • Disbursement invoices must be issued in the client's name and include the client's tax identification number, legal name, and full address;
  • Disbursement invoices must clearly indicate the nature and amount of the reimbursed expenses;
  • Suppliers must keep the original certified invoices or any other documents issued in the client's name and provide them to the tax administration upon request; and
  • Disbursed expenses must be invoiced separately under tax group "K" of the certified invoice template; and
• Amounts properly invoiced under these conditions are excluded both from VAT and from the supplier's deductible expenses.

NIGERIA: Notice on withholding tax from interest on short-term securities issued

In a recent public notice, the Federal Inland Revenue Service (“FIRS”) directed banks, discount houses, stockbrokers, corporate bond issuers, primary dealer market makers, financial institutions, government agencies and tax practitioners to deduct tax on interest payable to any person, including non-corporate entities, on the payment date.

As per the notice:

• Tax must be deducted from all interest payments on investments in short-term securities (including government bonds, treasury bills, promissory notes, corporate bonds, financial papers and bills of exchange) on the payment date at the applicable rate and remitted to the relevant authority no later than the 21st day of the following month; and
• Where the tax deducted is not final, the recipient will receive a tax credit equal to the amount withheld and remitted. It also provides that interest on federal government-issued bonds will remain exempt.

NIGERIA: Controversy over taxpayer identification number and banking access refuted by Joint Tax Board

The Joint Tax Board (“JTB”) has issued a press release on 14 September 2025, refuting claims that Nigerians without a taxpayer identification number (TIN) will be denied access to their bank accounts or prevented from conducting financial transactions from 1 January 2026.

The clarification follows controversy surrounding the JTB (comprising the 36 State Internal Revenue Services, the FCT-IRS, and the FIRS) and its collaboration with the FIRS to harmonise the National Tax Identification system. The system will leverage the National Identification Number (NIN) for individuals and the Registration Number (RC) for businesses as unique identifiers for tax purposes.

The JTB explained that the initiative will enable the seamless and automatic generation of TINs for individuals with NIN and businesses with RC, making it easier for Nigerians to comply with tax requirements without disrupting their banking operations.

NIGERIA: Collection of 4% free-on-board levy on imported goods suspended

The Minister of Finance, in a public notice (Ref. No. F6380/T/12) issued on 16 September 2025, has suspended the collection of the 4% free-on-board (“FOB”) levy previously charged by the Customs Service on all imported goods.

The suspension had been prompted by widespread concerns from businesses and trade experts regarding the FOB levy's impact on inflation, trade competitiveness and the overall business climate. The Minister noted that the suspension will give stakeholders time to review the levy framework and develop a more balanced revenue structure that supports both government earnings and economic growth.

NIGERIA: Tax Reform Laws published in Official Gazette

The government has published the following tax reform laws, enacted on 26 June 2025, in the Official Gazette:

• The Nigeria Tax Act, 2025;
• The Nigeria Tax Administration Act, 2025;
• The Nigeria Revenue Service (Establishment) Act, 2025; and
• The Joint Revenue Board (Establishment) Act, 2025.

NIGERIA: USD300 duty-free threshold for low-value imports introduced

The Nigeria Customs Service (“NCS”) has announced that imported goods valued at USD300 or less will qualify for duty-free clearance effective from 8 September 2025. The exemption from duty clearance applies to low-value imports, e-commerce consignments, and passenger baggage.

According to the NCS, individuals may use the exemption for up to four importations per year, provided the goods are not prohibited or restricted. To ensure compliance, the NCS will impose penalties for abuse, including forfeiture of goods, arrests, and other sanctions under the Nigeria Customs Service Act, 2023.

NIGERIA: Personal income tax calculator launched

On 21 August 2025, President Bola Tinubu has announced the launch of a personal income tax calculator that will enable taxpayers to estimate what their personal income tax obligations will be under the new tax laws effective from January 2026 and compare them with their current payments. It also factors in possible deductions, including pension contributions and payments to the national housing fund.

The government expects the tool to boost tax compliance and strengthen revenue collection without overburdening struggling households.

UGANDA: Gross interest basis for 30% EBITDA cap affirmed by Tax Appeal Tribunal

On 31 July 2025, the Tax Appeal Tribunal (“TAT”) has issued a ruling in the appeal case of Rwenzori Commodities Limited (“Rwenzori”) v Uganda Revenue Authority (“URA”) (No. 36 of 2024), deciding that the 30% limitation on earnings before interest, taxes, depreciation and amortization (“EBITDA”) must be applied on the basis of gross interest expense and not net interest expense.

In the case at hand, Rwenzori, a tea-growing and manufacturing company, had claimed an interest expense that exceeded the 30% EBITDA cap in its filed corporate income tax returns for 2019–2021. The URA audited Rwenzori's tax returns and found that it had claimed interest expenses of UGX1.7-billion which exceeded the statutory 30% EBITDA cap as provided by section 25(3) of the Income Tax Act. The excess interest was disallowed and additional tax assessments amounting to UGX521-million raised. Rwenzori objected to the assessment on grounds that it had paid both interest on debt and earned taxable interest income and therefore, the net interest expense after offsetting interest income should form the basis of the EBITDA calculation.

The URA disallowed the objection and Rwenzori, being dissatisfied with the respondent's decision, appealed to the TAT. The TAT ruled and found that:

• Section 25(3) of the Income Tax Act refers exclusively to “gross interest expense”, meaning that only gross interest qualifies for deduction under the 30% EBITDA limitation;
• Deductible interest must be interest incurred, and the Income Tax Act makes no reference to netting off interest income;
• Netting off interest income is not permissible, and the OECD BEPS approach is not binding and cannot override the Ugandan law; and
• The URA correctly applied section 25 of the Income Tax Act, and there was no misinterpretation or misapplication of the law.

The TAT dismissed Rwenzori's application and upheld the URA’s additional assessment of UGX521-million.

ZAMBIA: Landmark transfer pricing guidance provided by Supreme Court of Zambia

The Supreme Court of Zambia, delivered a landmark decision on 20 August 2025 in the case of the Zambia Revenue Authority (“ZRA”) v Nestle Zambia Limited (“NZL”) Appeal No. 03/2021, providing guidance on transfer pricing principles, the burden of proof, and the jurisdictional limits of the Tax Appeals Tribunal (“TAT”).

In the case at hand, NZL was audited by the ZRA for the tax years 2010-2014, resulting in an adjustment of profits and an additional tax assessment of ZMW13.8-million, including penalties and interest. The ZRA recharacterized NZL as a "low-risk distributor" and applied the Transactional Net Margin Method (“TNMM”). NZL appealed to the TAT, which upheld the audit but invalidated the assessment due to inappropriate transfer pricing methods and comparables. The ZRA appealed to the Supreme Court, challenging the invalidation by the TAT on five grounds, arguing that the Tribunal erred by:

• Shifting the burden of proof to ZRA;
• Requiring transaction-by-transaction analysis instead of aggregation;
• Finding no obligation for NZL to provide transfer pricing documentation;
• Deeming Western European comparables unsuitable; and
• Ignoring thin capitalization issues.

NZL cross-appealed, disputing its low-risk classification and arguing that the TAT exceeded its jurisdiction by ordering a reassessment.

The Supreme Court ruling:

• Reiterated that the burden of proof is on the taxpayer to demonstrate arm's length pricing;
• Allowed aggregation of related-party transactions for transfer pricing analysis;
• Permitted comparables from emerging markets like India and Brazil, emphasising economic similarity over geographical proximity;
• Upheld the use of TNMM for low-risk distributors like NZL; and
• Affirmed NZL's classification as a low-risk distributor based on evidence provided;

The court ordered NZL to pay the full ZMW13.8-million assessment, plus costs to ZRA. This case marks the first substantive transfer pricing case to reach the Supreme Court in Zambia.

ZIMBABWE: Implementation of wealth tax suspended to address compliance gaps

During a parliamentary session on 10 September 2025, the Deputy Minister of Finance and Investment Promotion has announced the temporary suspension of the implementation of the wealth tax, pending completion of further administrative and legislative processes.

The wealth tax, whose aim is to broaden Zimbabwe's revenue base beyond traditional income and consumption taxes, was introduced under the Finance Act, 2023 which came into effect on 1 January 2024.

The tax is:

• Imposed at the rate of 1% on the value of a dwelling other than a private dwelling of a taxpayer if such value exceeds USD250 000, with the maximum liability of the tax for any one taxable dwelling capped at USD50 000 per annum; and
• Collected by the local authority where the taxable dwelling is located or any other collection agent approved by the Ministry of Finance, and is subsequently remitted to the Zimbabwe Revenue Authority (ZRA) on its behalf.

The implementation of the tax was suspended to address stakeholder concerns and to establish clear mechanisms for assessing, monitoring, and collecting the tax. According to the Minister, revenue collection will commence only after these issues have been addressed.

Celia Becker

Executive | Africa Regulatory and Business Intelligence 

cbecker@ENSafrica.com