Africa Tax In Brief – June 2016

BOTSWANA: Exchange of information agreement with Isle of Man enters into force

The Botswana/Isle of Man Exchange of Information Agreement (2013) entered into force on 5 March 2016 and generally applies from 5 March 2016.

KENYA: Stamp duty on nominal share capital

Following publication of Legal Notice No. 60 of 2016 dated 12 April 2016, the initial nominal share capital of a limited liability company is now exempt from stamp duty.

MALAWI: 2016/17 Budget presented to parliament

On 27 May 2016, the Minister of Finance, Economic Planning and Development presented the Budget for 2016/17 to parliament.

Proposed measures include:

increasing the corporate tax rate from 21% to 30% for life insurance businesses; removing the tax exemption previously granted on the first MWK10 000 of interest income on saving accounts; imposing the standard VAT rate of 16.5% on certain goods that are currently exempt or zero-rated; and permitting miners in the minerals exploration stage to register for VAT and make VAT claims. These changes take effect from 1 July 2016, upon passage of the bill.

MALI: Amendment to employment income tax rates gazetted

Law No. 2016-010 amending the General Tax Code was published in the Official Gazette No. 19 of 6 May 2016. With effect from 1 July 2015, the following tax rates apply:

NIGERIA: 2016 Budget signed into law

On 6 May 2016, President Buhari signed the Budget ("2016 Appropriation Act") into law. The Budget Speech did not contain any proposal or indications to increase tax rates or impose new taxes in 2016 and is silent on the proposals by the National Assembly to introduce a National Security Tax and Communication Service Tax as well as the proposed increase in Tertiary Education Tax ("TET") by the TET Fund.

The government is, however, focused on measures to increase the tax base and overall compliance rate in the country. It was announced that luxury tax is expected to generate NGN15-billion and smaller businesses are to enjoy a reduced tax rate, but the measures to implement these provisions have not been published yet.

SWAZILAND: 2016/17 Budget presented to parliament

The Budget for 2016/17 was presented to parliament by the Minister of Finance on 4 March 2016. The Budget proposes converting the national provident fund into a pension fund and announced various measures to improve tax administration.

TANZANIA: Court of Appeal decision that payments for services rendered outside Tanzania are not liable to withholding tax

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