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Africa tax in brief

BURKINA FASO: Multilateral Instrument instrument of ratification deposited

On 30 October 2020, Burkina Faso deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (“MLI”). The convention will enter into force in respect of Burkina Faso on 1 February 2021.

Burkina Faso submitted its MLI position on 7 June 2017 listing its reservations and notifications and including three tax treaties that it wished to be covered by the MLI. No significant amendments have been made to the final version of its MLI position.

BURKINA FASO: General Tax Administration launches campaign to recover outstanding taxes

The Director of General Tax Administration on 30 October 2020 announced the launching of a campaign, due to run until the end of the year, to recover tax amounts that are in arrears. Taxpayers who are not up to date with their tax obligations have been invited to settle their outstanding obligations.

KENYA: Regulations on electronic tax invoices and VAT on supplies through digital market places published

On 25 September 2020 the Cabinet Secretary of National Treasury gazetted the Value Added Tax (Electronic Tax Invoices) Regulations, 2020 and the Value Added Tax (Digital Market Supply) Regulations, 2020.

The Value Added Tax (Electronic Tax Invoices) Regulations, 2020 require every VAT-registered person to have a “register”, ie, an electronic tax invoicing or receipting system that ensures that each sale is recorded at the point of sale and the invoice details are transmitted to the Kenya Revenue Authority (“KRA”) on a daily basis.

The objective of these regulations is to ensure the efficient transmission of data from the register to the system of the KRA to improve the efficiency of tax collection and to facilitate integration of the KRA’s system with other entities.

The regulations set out:

  • the obligations of the user of a register;
  • specifications of a register;
  • details that must be included in a tax invoice generated from a register; and
  • the transmission of invoice data and security

The regulations require that all VAT-registered persons should have a register in place on or before 25 September 2021. However, a VAT-registered taxpayer can, on application to the Commissioner at least 30 days before the 25 September, 2021, apply for an extension of compliance, which extension will not exceed six months.

The Value Added Tax (Digital Marketplace Supply) Regulations, 2020 provide for the implementation of changes introduced by the Finance Act 2019, which include supplies made through a digital marketplace within the scope of VAT.

The regulations cover, inter alia, the:

  • scope of taxable supplies;
  • registration requirements;
  • simplified registration for non-residents; and
  • rules on place and time of supplies.

All digital suppliers are required to comply with these regulations within six months from the publication of the regulations and any person who fails to comply will be liable for penalties under the VAT Act or the Tax Procedures Act.

MALAWI: Relief under personal income tax regime to be increased

The Taxation (Amendment) Bill 2020, which was presented to parliament on 2 October 2020, proposes to increase the relief available to individuals by increasing the 0% tax rate threshold from MWK540 000 to MWK1.2-million. The 15% tax rate band will, however, be removed. Going forward, taxpayers are to be taxed under three rate bands (0% for the first MWK1.2-million per annum; 30% for the next MWK34.8-million and 35% for amounts in excess of MWK36-million).

The tax free threshold for casual labour under the withholding tax regime will be increased from MWK15 000 to MWK35 000 per transaction.

It is also proposed to introduce a 20% withholding tax on winnings from betting and gambling transactions, including lotteries.

MAURITIUS: Notice to employers issued re deadline for Monthly Contribution Returns

The Mauritius Revenue Authority, on 26 October 2020, issued a notice to employers informing them that, following the introduction of the Contribution Sociale Généralisée (“CSG”), the deadline for the submission of the Monthly Contribution Return and payment of contributions for the month of September 2020 is 30 November 2020. The deadline for the submission of the Monthly Contribution Return for any subsequent month is the end of the following month.

The Monthly Contribution Return includes contributions in respect of:

  • the CSG;
  • the National Savings Funds; and
  • the Training Levy.

NIGERIA: Further palliative measures announced to address recent business disruptions

As a result of the political unrest in Nigeria, the Federal Inland Revenue Service has issued a Public Notice on 4 November 2020 extending the window for the waiver of penalties and interest on outstanding tax liabilities arising from self-assessments, desk reviews, tax audits and investigations.

This is in addition to the earlier palliative measures announced to mitigate the impact of the COVID-19 pandemic on taxpayers. However, affected taxpayers must settle their outstanding tax debts in full by 31 December 2020 in order to qualify for the relief.

ZAMBIA: Statutory Order exempts medical supplies

The VAT Act (Zero Rating) (Amendment) Order 2020, Statutory Instrument No. 89 of 2020, which was issued on 30 October 2020, exempts various medical supplies, including diagnostic test instruments, gas masks, gloves and protective garments, from VAT with effect from 1 October 2020 to 30 September 2021.

Sources include IBFD’s Tax Research Platform; www.allafrica.com; http://tax-news.com

Celia Becker
Africa Regulatory and Business Intelligence | Executive
cbecker@ENSafrica.com
+27 82 886 8744