Chad

Corporate - Tax credits and incentives

Last reviewed - 25 August 2022

Tax incentives are provided by:

  • The General Tax Code.
  • Petroleum agreements concluded between oil companies and the Government of Republic of Chad.
  • Mine agreements concluded between oil companies and the Government of Republic of Chad.

The main tax incentives provided by General Tax Code are:

  • As of January 1, 2020, new companies under corporate Chadian law which carry out activities in the sector of agriculture, farming, renewable energies and information and communication technologies in the first five (05) years of their exercise benefit from a reduction of 50% of the registration fee and 50% of the corporate income tax base base subject, and are exempt from business tax, minimum income tax, flat rate tax, apprenticeship tax.
  • Companies may benefit from the tax reductions for which it is they are liable if an investment of at least XAF 250,000,000 have been done in the following sectors:
    • industry;
    • tourism;
    • research and mining exploitation;
    • farming, agriculture,fishing;
    • education;
    • sport; 
    • hotel;
    • transportation;
    • information and communication technologies.

To benefit from tax advantages, taxpayers shall make investments of at least XAF 250,000,000 in Chad, either by creating new activities or by extending of existing activities.The investments made shall take one of the following additional forms:

  • Purchase of available local products or raw materials,
  • Use of at least 50% of the local workforce,
  • Acquisition of land for professional use,
  • Acquisition of new movable property for professional use,
  •  Acquisition of new equipment.

The granting of tax incentives is subject to formal requirements. Tax advantages granted in the event of approval of the application for tax incentives are:
● During the installation phase, which cannot exceed twenty-four (24) months, taxpayers benefit from the following tax advantages:
➔ A reduction of 50% of the amount of bbusiness tax, minimum income tax, registration fees, flat rate tax, apprenticeship tax, tax on the rental value of business premises,
➔ An exemption from value added tax (VAT) on the acquisition of production tools whose unit value excluding taxes is equal to or greater than XAF 50 million.
● During the operating phase, which cannot exceed three (3) years, taxpayers benefit from tax benefits below:
➔ A 50% reduction in the amount of the business tax.
➔ A reduction of 50%:
o the corporate income tax base (IS) on eligible investments,
o the base of the minimum income tax,
➔ Exemption from specific excise duty on local production.

  • Tax incentives up to the amount of investment for an investment of at least XAF 100 million in the provinces of Chad. A 50% reduction applies to: 
    • the base of minimum income tax;
    • the withholding tax on rental for the rents sheltering these investments;
    • registration fees on rental contracts for these investments;

Furthermore, the following tax incentives apply:

  • an increase of 2% in the deductibility ceiling for donations;
  • 25% reduction in the fee for the use of radio-electronic frequencies

Tax incentives provided by petroleum and mine agreements are namely:

  • CIT exoneration.
  • VAT exemption.
  • Apprenticeship tax exemption.
  • Property taxes.

Foreign tax credit

There are no provisions for foreign tax credit in Chad.