Congo, Republic of

Corporate - Significant developments

Last reviewed - 30 June 2022

Following the revision of the 2021 Finance Act as published on 13 August 2021, some provisions of the General Tax Code have been revised:

  • Novation contracts are subject to a fixed registration fee of 1 million CFA francs (XAF).
  • It is now clarified that justified value-added tax (VAT) credit would be reimbursed at the end of each quarter for diplomatic or consular missions, subject to reciprocity when they have previously paid the tax.
  • Tax on occupancy for professional premises for oil companies is a fixed amount of XAF 5 million per permit.
  • Computer royalty rate has increased from 1% to 2% for the import and export of goods under ordinary law while computer royalty at the rate of 1% has been introduced for the subscription and regularisation of suspensive arrangements.
  • Cement produced in Congo is exempt from export duty.

Further to the promulgation of the 2021 Finance Act, the following new measures have been introduced:

  • Taxpayers with an annual turnover, excluding taxes, less that XAF 100 million are subject to the flat-rate taxation scheme.
  • Taxpayers under the flat-rate taxation scheme who fail to declare, no later than the 20th day of the month following each quarter, the list of suppliers of their sources of supply will bear a fine of XAF 500,000.
  • Filing and payment of taxes for taxpayers under the actual tax scheme must be made remotely using the eTax platform, and non-compliance would trigger a 10% penalty assessed on the amount to be filed.
  • Financial statements of companies under the actual tax scheme with no statutory auditors must be certified by a chartered accountant.
  • The fine for late filing or omission to file the transfer pricing documentation and/or declaration is only due after an 8-days formal prior notice to the taxpayer.
  • Amounts invoiced by a foreign company that do not reflect arm's-length conditions are fully reintegrated into the taxable income of the company established in Congo during a tax audit.
  • Failure to show proof of a professional installation in Congo, and regardless of a short-term business licence (ATE), the foreign subcontracting company would be subject to a withholding tax (WHT) under Article 185 ter of the CGI, volume 1.
  • The deemed profit tax rate has been reduced from 35% to 33%.
  • The corporate income tax (CIT) rate has been reduced from 30% to 28% for companies exploiting mines/quarries, as well as for those in real estate.
  • Expenses that are not paid within two years from their accounting registration are added back to the taxable profit of the first financial year subject to the accounting audit, notwithstanding the fact that the accounting year would be statute barred or had been audited.
  • Companies fully exempted from CIT are liable to the minimum tax at the rate of 1% of their total turnover, with a minimum amount collected of XAF 1 million.
  • The minimum tax assessed at the rate of 2%, payable by companies showing losses during two consecutive fiscal years, has been abolished.
  • Newly created companies are no longer exempt from the business tax.
  • The communication right of the tax authorities around documents they can request during an audit has been enlarged.
  • Penalties, surcharges, and late interests claimed by the tax authorities must be paid separately from the relating principal amounts. Payment is made through bank transfer, certified bank cheques, or in cash for amounts below XAF 5 million in the Public Treasury’s account.
  • The statute barred period for the year ended 31 December 2016 has been extended up to 31 May 2021.
  • Security agreements, deeds recording privileges, and loans financing investments must be registered within three months from their date.
  • Deeds referred to under Articles 236 and 237 of the CGI, Volume 2, Book 1 must be registered within three months from their date.
  • Registration fees for debts transfers are now levied on the value of the debt.
  • Novation contracts are registered free of charge.
  • Successors’ agreements are subject to registration under the same conditions as transfers of business assets or of customers made for a fee, even if there is no transfer of customers.
  • Private law entities are automatically liable to VAT, regardless of their annual turnover or industry. 
  • Individuals whose annual turnover, excluding taxes, exceeds XAF 100 million are subject to VAT, regardless of their industry.
  • A list of tangible and intangible services subject to VAT has been defined.
  • Conditions for deduction of import VAT have been defined.
  • Companies liable to import VAT can delay payment of such VAT under certain conditions.
  • The list of persons and the conditions to benefit from VAT credit reimbursement has been revised.
  • The tax storage warehouse regime is abolished.
  • The rate of excise duties has been increased from 15% to 16.5% for tobacco and from 12.5% to 15% for motor vehicles and motorcycles.
  • The single tax on salaries’ shares allocated to the Impulse Guarantee and Support Fund, the Congolese Employment Agency, and the National Support Fund for Employment and Apprenticeship are collected by the National Social Security Fund as are social contributions.
  • Taxpayers can opt to make a single payment of their flat-rate global tax instead of four equal instalment payments.
  • The tax regime of oil sector companies has been revised, subject to international treaties, to subject them to the general taxation.
  • Purchase orders signed within an oil contract can be registered free of charge, within three months of their date.
  • Purchase orders signed outside an oil contract shall be registered at a proportional fee of 1% of the amount, within three months of their date.
  • Capital gains realised upon the sale of interests in oil contracts are subject to a flat tax at the rate of 10%.
  • Subject to the provisions of international tax treaties, interests on loans paid to foreign individuals or entities by oil companies established in Congo are subject to a 5% WHT when these loans relate to acquisitions directly intended for oil studies, research, exploration, development, and exploitation.
  • A list of materials that can be imported during the exploration, research, development, and exploitation phase duty-free admission regime, under the normal temporary admission regime, under the reduced rate admission regime, or under the common admission rules by oil companies has been defined.
  • Computer royalty rate ranges from 0% to 2% depending on the transaction.
  • The solidarity contribution for universal health insurance coverage has been introduced and it is due by entities, individual business owners, and high-income holders for the share of their income exceeding XAF 500,000.
  • Prohibition of combined incentives under the investment charter and another privilege regime.
  • Taxes, duties, and fees, as well as customs duties and taxes, are paid at a one-stop-shop regardless of the tax residency.