Corporate - Significant developments

Last reviewed - 16 February 2024

Reform 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.