Value-added tax (VAT)
The VAT rate applicable in Chad is:
- 18% on all taxable operations.
- 9% on local products, such as cement, sugar, oil, soap, textiles, concrete, and iron.
- 0% on exports and their related international transportation, refuelling operations for aircraft with a foreign destination, and products and sub-products of local agri-food industry (excluding alcohol).
An operation performed in Chad that constitutes an economic activity and for which payment is made, unless included in the list of exemptions in the law governing VAT, is liable for VAT, even if the residence of the natural person or the registered office of the legal entity is located outside Chad.
The VAT law provides a list of transactions exempted from VAT that includes, among many others, the following:
- Sales of products that are directly made by farmers, cattle farmers, or fishermen to consumers, farming, and fishing operations.
- Import operations and sales of newspapers and periodicals, other than the advertising revenues.
- Leasing transactions.
- Sales of gas oil and petrol by the refining company of N’Djamena.
- Acquisition of equipment and materials for the promotion and production of renewable energy.
- Interests on loans used for the financing of renewable energy.
Before fiscal year 2018, the refund of VAT credit applied only to some categories of taxpayers.
From fiscal year 2018, any taxpayer (resident) subject to VAT may apply for the refund of VAT credit, except taxpayers who benefit from any exemption via establishment agreements.
The deadline for the application of the refund of VAT credit is 24 months from the birth of this credit.
The refund of VAT credit is guaranteed by an escrow account domiciled in Bank of the States of Central Africa. This account is fuelled by 15% of various VAT revenues.
Any VAT credit officially recognised by the tax administration shall be refunded.
The consequences of the application for VAT credit are as follows:
- No possibility to use the VAT credit in the filings of the month that follows the one from which the application of refund of the said VAT credit has been made.
- No possibility to deduct the structural VAT credits at the end of a fiscal year.
Refund of VAT credit is disallowed in the following cases:
- Lack of proof of the VAT credit for which refund has been applied for.
- Application for VAT credit done out of the deadline, i.e. after 24 months.
- Taxpayers did not pay all the taxes due.
The consequences of the rejection of the application for VAT credit:
- The lack of justification of this VAT credit will lead to the automatic cancellation of the said VAT credit.
The practise modalities of the refund of the VAT credit are not yet precised by the tax administration.
The tax basis of customs duties corresponds with the customs valuation, namely the selling price of the goods plus cost of delivery to Chad (costs of insurance, transportation, etc.).
The rates of customs duties depend on the nature of the goods and range from 5% to 30%. These rates can be summarised as follows:
- Goods of first need (basic necessities): 5%.
- Raw materials and goods of equipment: 10%.
- Intermediate and miscellaneous goods: 20%.
- Consumer goods: 30%.
Excise duty applies to goods of great consumption: cigarettes, drinks (water, beer, and wine), cosmetics, and luxury products, and transactions of mobile companies, which are the legal taxpayers. Excise duty rates depend on the nature of the goods and range from 5% to 25% of the value of the good.
Some of the rates are as follows:
- Water: 5%.
- Beer and wine: 25%.
- Perfume, jewellery, electronic devices (except computers, telephones etc.), private vehicles with an engine capacity above 1600 cm³, and weapons: 20%.
- Compound alcoholic preparations: 25%.
- Tobacco (all types): 25%.
- Turnover of mobile companies (legal taxpayers) realised on their transactions: 18%.
This value differs depending on the origin of the good. If the good has been manufactured in the Economic and Monetary Community of Central Africa (CEMAC) zone, the value corresponds with the selling price charged by the manufacturer. If the good is imported into the CEMAC zone, the value is the sum of the freight value plus insurance costs and customs duties.
This value constitutes the basis of the calculations of the excise duty.
Real property tax
The annual real property tax differs according to whether it is a built or an unbuilt property and whether it is located in N’Djamena or elsewhere. The tax is imposed in the municipality where the property is situated.
The tax rate on built property is 10% in N’Djamena and 8% elsewhere.
The tax rate on unbuilt property is 21% in N’Djamena and 20% elsewhere.
The calculation basis is the potential revenue of that property. The potential revenues correspond to four-fifths of the rental value, the rental value being 10% of the market value. For rural unbuilt property, the market value is fixed to XAF 50,000 per hectare.
Some temporary exemptions are granted to new buildings or additions to constructed buildings after 1 January 1968 from this tax in some conditions. In case of construction or reconstruction, owners can benefit from temporary exemptions as follows:
- If the villa is owned by a corporation: 2 years.
- If the villa belongs to an individual and put on rental: 2 years.
- If the villa is built or rebuilt for commercial and industrial use: 2 years.
- New construction or reconstruction and additions to buildings for a holiday resort, for approval (accreditation), or for furnished rent are excluded.
The person occupying a building (owner or tenant) has to pay the following amount as accommodation tax annually:
|Type of construction||N’Djamena (XAF)||Elsewhere (XAF)|
|For constructions in local material||10,000||5,000|
|For hard or semi-hard constructions||25,000||15,000|
|For R+ hard constructions||40,000 and a supplement of 20,000 per level||20,000 and a supplement of 10,000 per level|
Fixed or proportional transfer duties must be paid on the transfer of ownership of estates, personal property, and real property. Transfer duties are also due on contributions to companies and divisions of property. The proportional fees for the following transfers are:
- Transfers of ownership interests in companies whose capital is not divided into shares: 3%.
- Transfers of shares, founders' shares, or profit shares: 3%.
- Transfers of bonds of companies and legal entities: 3%.
- Transfers of the right to lease or of the benefit of a promise to lease real estates: 10%.
- Transfers of goodwill (business) against payment: 10%.
- Transfer of leases of real estate: 10%.
- Transfers of pension against payment: 10%.
- The undivided shares and portions of real property acquired by bidding are subject to land transfer tax against payment at 10%.
- Transfers and delegations of term debts: 3%.
- The perfect transfer of notarised promissory notes containing the creation of a mortgage and other mortgage bonds: 5%.
- Real estate returns are subject to land transfer (against payment) tax of 10%.
- Transferring ownership for consideration of movable property: 6%.
- Judicial transfer (against payment) of ownership or usufruct of both developed and undeveloped land is 10%.
These transfers are generally registered within three months of their entry into possession.
Stamp duties must be paid on each civil or judicial document intended to be used as evidence. Stamp duty is generally XAF 1,000 per page.
All claims for reimbursement submitted to the Board are subject to a stamp duty of XAF 2,000.
Requests to the administration for professional competitions are subject to a stamp duty of XAF 1,000.
Applications for allocation of land are subject to a stamp duty of XAF 1,000.
Invoices for supplies to the administration of less than XAF 1 million are subject to a stamp duty of XAF 5,000. The same applies to certificate of sales of reshaped vehicles and materials of vehicles of the state and public bodies.
All invoices that accompany an order of the administration in lieu of a service contract or a public market are subject to a stamp duty of XAF 5,000.
Any application, other than those mentioned above, addressed to the tax authorities is subject to a stamp duty of XAF 2,000.
Furthermore, the stamp duties on the following official documents are as follows:
|Documents||Issuance fees (XAF)||Stamp fees (XAF)||Total (XAF)|
|Citizens of CEMAC area||292,500||7,500||300,000|
|Citizens of other countries||500,000||10,000||510,000|
|Extension of stay||5,000||-||5,000|
|National identity card||9,000||1,000||10,000|
|Passport for adult Chadian abroad||97,500||7,500||105,000|
|Passport for minors abroad||45,000||7,500||52,500|
|Passport for minors in Chad||35,000||7,500||42,500|
The registration duty applies to certain deeds listed by the General Tax Code (GTC). The assessment basis depends on the nature of transactions, and the rate varies from 0.25% to 15%.
Employers in Chad are required to make monthly contributions of 7.5% of the total amount of salaries and fringe benefits paid to permanent employees.
Social security contributions
The monthly contribution to Chad’s Social Security Funds is 16.5% of total salaries for the employer (upper limit: XAF 82,500 per month) and 3.5% for the employee (upper limit: XAF 17,500 per month), withheld by the employer.
Employers in Chad are required to make monthly contributions of 1.2% of the total amount of salaries and fringe benefits of their employees (permanent and temporary) to the National Professional Training Funds (FONAP).
Business licence tax
Any natural person or corporate body carrying on a trade, industry, or profession in Chad shall be liable to a business licence tax. The business licence tax is paid annually and is assessed as follows:
- A determined duty based on 0.35% of turnover of the fiscal year N-2.
For a new company, there is an exemption for the first year from the setting-up of the new company.
The business licence tax is due 31 December of the tax year.
Special tax on oil products
The 2017 financial law instituted the special tax on oil products (in French: Taxe Spéciale sur les Produits Pétroliers). The rates of this tax are as follows:
- Petrol: XAF 50 per litre.
- Gasoil: XAF 50 per litre.
- Jet A1: XAF 50 per litre.
This tax is due at the time of consumption and is supported by the final consumer. It is not deductible for the marketers.
The 2018 financial law has introduced capped fees as follows:
- Gasoline: XAF 47 per litre.
- Gasoil: XAF 22 per litre.
- Jet A1: XAF 20 per litre.
- Petrol: XAF 5 per litre.
Tax for the modernisation of airport infrastructures
The 2017 financial law instituted the tax for the modernisation of airport infrastructures, which rates are as follows:
- Economic class tickets for flight: XAF 10,000.
- Intermediary or business class tickets for flight: XAF 15,000.
This tax is due at the time of payments of the tickets for flight and is supported by the buyer and collected by the airline company and paid to the public Treasury.
From January 2018, the tax for modernisation of airport infrastructures is renowned in fees (in French ‘redevances’) for modernisation of airport infrastructures and is paid to the Chadian Civil Aviation Authority.
Tax on behalf of the African Union on imports
The 2017 financial law instituted a tax at the rate of 0.2% on imports out of the Africa area on behalf of the African Union.
The applicable modalities are not yet precised by a ministerial decision.
Tax on money transfer
Money transfer tax applies to:
- money transfer operations carried out by any means or technical support leaving trace, in particular by electronic means, mobile telephony, telegraph, or by means of telex or fax, and
- cash withdrawal transactions related to transfers made by financial institutions and telephone companies.
The tax on money transfers is not applicable to bank transfers and transfers for the settlement of taxes, duties, and levies.
The tax is based on the amount of sums transferred or withdrawn.
The tax is liquidated at the rate of 0.2%. This rate will be 5%, as of 1 April 2022, for cash withdrawals made on stored communication credit (listed stored).