Sun, 16 Jun 2019 12:02 - Updated Sun, 16 Jun 2019 12:02
President recommends VAT implementation this year
Luanda - Angolan head of State João Lourenço Saturday in Luanda recommended the Government to evaluate the best moment for the implementation of Value Added Tax (VAT), preferably from this year.
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VAT implementation was initially planned for 1 July, but representatives of the Government and the business technical group (GTE), its partner in this matter, agreed on Friday to postpone the process until October this year.
João Lourenço was speaking at the ruling MPLA party’s 7th Extraordinary Congress opening session on Saturday in Luanda, stressing that his party considered VAT as the world’s "fairest" tax.
In Angola, he said, VAT will stand at 14 percent, with no forecast of its accumulation with the consumption tax, which is around 30 percent.
“The possible rise in prices blamed on VAT is groundless," said the MPLA leader, adding that if it happens it will be by mere speculation of bad faith traders, about which consumer protection institutions should be aware.
In government programme, VAT should be in place as from 1 July this year, but the GTE has been defending its transfer to January 2020, ie three months after the new date decided on Friday, market.
On Friday, the parties also decided to reduce the seven percent rate for transitional companies as well as a careful analysis of the application of VAT in education and private education.
Another recommendation emerged from the Friday meeting has to do with the deduction of at least two percent on the value of stocks in the settled sum of industrial tax presumed.
The parties have also decided to consider mechanisms to create a "specific" legal instrument to avoid double taxation, in the case of advances to official brokers.
The VAT Code provides for a flat rate of 14 per cent for all imports of goods and for all large taxpayers with revenues exceeding 15 million kwanzas, as well as large public enterprises and banking financial institutions.
In general terms, new taxes will be applied as soon as the VAT is implemented and should replace the previous taxation with the use of the consumption tax (CI).
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