Madagascar
Corporate - Significant developments
Last reviewed - 16 February 2024Reform of the General Tax Code introduced in the 2023 Financial Law
The reform consists of the extraction of procedural tax provisions from the General Tax Code. From January 2023, the General Tax Code is split into:
- Tax Code (Code Des Impôts): This code will include the rules of tax assessment and liquidation as well as tax conventions and the special tax regime for free zones and enterprises
- Tax Procedures Code (Code des Procédures Fiscales): This code will contain the tax provisions relating mainly to actions carried out between the Tax Administration and taxpayers such as registration, declaration and payment of tax, collection, tax audit, tax litigation or any other procedures governed by the Tax Law.
From 2024, synthetic tax regime for taxpayers having turnover of less than 400,000,000 Ariary
Any corporate entity having a turnover less than 400,000,000 Ariary (200,000,000 Ariary before) is subject to CIT under synthetic regime.
Keep accounting in official languages only, under the real regime from 2024
Obligation to keep regular accounts only in Malagasy or in French whether the accounting is manual or computerized.
Increase of the minimum CIT under the real regime from 2024
Under the real regime CIT cannot be less than the minimum set below:
- Ar 500,000, increased by 1p.100 of the annual turnover excluding tax of the exercise, for taxable persons carrying out agricultural, artisanal, industrial, mining, hotel and tourist activities;
- Ar 1,000,000, increased by 1% of the annual turnover excluding tax for the financial year, for other companies. However, the minimum is 2p.1000 of annual turnover for taxpayers selling fuels at retail. For land, river and maritime transporters of people and goods, the minimum collection is set by regulatory text provided for by the 3rd paragraph of article 01.02.05 of this Code.
Reduction of the period of presence in Madagascar for determining permanent establishment status
Reduction of the period of presence in Madagascar for the status of a permanent establishment from 180 days to 120 days for a construction site, an assembly or installation project or supervision activities linked to this project; and to 90 days for the provision of services.