Value-added tax (VAT)
VAT scope and rates
VAT is levied under the Tunisian VAT Code and is due on all transactions taking place in Tunisia.
The sale of goods is considered as taking place in Tunisia, and subject to VAT, if the goods sold are delivered in Tunisia. The sale of services is considered as taking place in Tunisia, and subject to VAT, if the services sold are exploited or used in Tunisia.
The standard rate of VAT is 19%. Lower rates of 13% and 7% apply to specifically designated operations. Note that these rates are effective as of 1 January 2018 (previously 18%, 12%, and 6%, respectively).
Some operations, products, or services are out of the scope of VAT in Tunisia, and some others are expressly exempt from VAT.
Some goods and services may be acquired VAT free, based on a certificate delivered for the purpose by the relevant tax authorities. This exemption is granted mainly to wholly exporting companies (other than international trade companies and service companies, that no longer benefit from the VAT free acquisition of goods as per Finance Law 2022 (please see detail below)), oil and gas companies, their contracts, and their subcontractors.
Registration for VAT purposes may be either obligatory or optional.
Voluntary registration is allowed where persons:
- carry out activities that are outside the scope of the Tunisian VAT, in which case the option has to be a full option, which means that all the activities carried out by these persons will be subject to VAT, or
- carry out operations that are exempt from VAT and that are destined for export, or supply products and services that are exempt from VAT to persons liable to VAT, in which case the option may be a partial or a full option.
Output VAT is calculated on the basis of the amount of the taxable transaction excluding VAT.
Individuals and companies that are subject to VAT may deduct the input VAT incurred on the purchase of goods and services necessary to carry out activities subject to VAT.
VAT is declared and paid on a monthly basis.
If the input VAT exceeds the output VAT, the VAT credit resulting from the difference between the input VAT and the output VAT may be reimbursed on the basis of a written request made to the tax authorities.
The VAT credit is refundable if it arises from:
- exportation operations of goods and services, sales made to clients allowed to acquire goods and services VAT-free, and WHT made on the remunerations paid to companies that are neither resident nor established in Tunisia (such VAT credit is refundable if it is shown on one monthly tax return)
- investments destined for the carrying out of new projects under the conditions set out by the Investment Law (such VAT credit is refundable if it is shown on at least three successive monthly tax returns), or
- other operations (such VAT credit is refundable if it is shown on at least six successive monthly tax returns).
In order to benefit from the refund of VAT credits, the taxpayer has to file supporting documents, such as declarations relating to exportation of goods, documents proving that the service rendered by the Tunisian taxpayer was used or consumed outside Tunisia, authorisations to sell VAT-free, and WHT certificates.
To benefit from the refund of VAT credits, the taxpayer must already have submitted all tax returns and paid all taxes due at the time of submission of the request for the refund.
The VAT credit (other than the one derived from exports, VAT-free sales, and WHT of VAT and from some investments as provided for by article 15 of the VAT Code) subject to six successive monthly tax returns showing a credit, is reimbursable through an advance payment of 15% on request without preceding tax audit. This rate is increased to 50% for companies which financial statements are subject to statutory audit, subject to the certification with no modification affecting the tax basis of the last financial statements due at the date of the refund request. The remaining balance will be reimbursed subject to a tax audit.
For companies that rely from the Big Companies Direction (Direction des Grandes Entreprises), the said advance will be increased to 100%, subject to a special report issued by the statutory auditor and relating to the CIT credit to be requested for refund.
The VAT credit derived from exports, VAT-free sales, WHT of VAT, and from investments as provided for by article 3 of the investment law is reimbursable through an advance payment of 100% on request without preceding tax audit.
The refund would be considered as final subject to a tax audit.
The taxpayer may claim the VAT credit within three years starting from the date from which the VAT credit becomes refundable.
Customs duties/Import tariffs
Importation of goods and services are subject to import VAT unless:
- the imported good is expressly exempt, such as for:
- fresh milk, uncondensed and unsweetened, whether skimmed or full-fat
- milk flour
- devices intended for use by physically disabled persons
- pure-bred breeding animals
- equipment with nothing similar manufactured locally, expressly designated, or
- boats destined to maritime navigation and fishing, and other pleasure boats, or
- the importer benefits from the acquisition of goods necessary to its activity VAT-free (e.g. oil and gas companies).
Customs duties are due on importations other than those made from the European Union (EU).
Some equipment expressly designated by the Tunisian domestic law is exempt from customs duties, whether imported from EU countries or not.
Customs duties are not due in cases where the importer is expressly exempt, even if the goods are imported from outside the European Union.
For temporary importation of equipment, the customs duties due are to be calculated in proportion to the period spent in Tunisia. 1/60 of the total customs duties are due per month spent in Tunisia.
As per article 39 of the Finance Law 2018, subject to fixed customs rates, common customs duties for products and equipment with NGP codes included in chapters 25 to 97 are increased as of 1 January 2018 from 20% to 30% and from 0% to 15% for listed products (listed in appendix 2 to the Finance Law 2018).
In addition, the Finance Law 2018, as modified by the Finance Law 2020, provided for an increase in the customs duties rates applicable to a list of products originated from Turkey for a period of four years as of 1 January 2018. These provisions will be eliminated progressively over a period of three years using equal average annual rates, after the expiry of a period of four years.
Also, the Finance Law 2022 has increased customs duties for some products from 0%, 15% or 30% to 43%, and from 0%, 15%, 30% or 36% to 50%.
- Example of products which the custom duties will increase to 43%: cements, Paints, Perfumes and toilet waters, Beauty or make-up products, Soaps, Transport and packaging articles, Tableware, Ceramic products, Glasses, Watches…
- Example of products which the custom duties will increase to 50%: Cheeses, honey, vegetables and fruits, coffee, sausages, bakery and pastry products, fermented drinks, ethyl alcohol, clothing and clothing accessories, shoes…
In addition, the finance law 2022 has decreased custom duties on solar panels from 20% to 10% and provided decrease of custom duties on some vehicles with a hybrid thermal and electric engine.
There are no provisions for excise taxes in Tunisia.
A real estate tax (RET) is calculated by the relevant municipalities and is notified annually to the taxpayers at the beginning of the civil year.
For companies subject to the payment of the local authority tax (LAT) (see below) and in case the LAT paid over the year is less than the RET notified by the municipalities, then the differential is due and is payable as complementary LAT. In other words, the RET constitutes a minimum of due LAT per year.
The registration of some operations is compulsory. In these cases, the registration fees are expressly determined by the Registration and Stamp Fees Code.
Registration remains optional for certain operations. In case of optional registration, the registration fees due to be paid are equal to TND 30 (as per finance law 2022) per page and per copy.
In case of compulsory registration, the fees due depend on the nature of the transaction and the goods involved.
Some transactions are subject to proportional registration fees, for example:
- 5% on the transfer of immovable properties. However, this rate is reduced to 3% for the acquisition of social housing from real estate developers for the portion exceeding TND 500,000 (as per finance law 2022) with a minimum equal to the fixed fee calculated at TND 30 per page and per copy of the contract subject to registration. An additional registration fee is due at the rate of 2% for the transfer of immovable properties (other than immovable properties used for business purposes and subject to a favourable tax regime) which value ranges between TND 500,000 TND and TND 1 million and 4% for immovable properties which value exceeds TND 1 million.
- 2.5% for the transfer of goodwill (fonds de commerce).
Transactions that are not subject to proportional registration fees, as well as transactions for which registration is optional, are subject to insignificant fixed registration fees (TND 30 per page).
Contracts and agreements (including concessions agreements, marketing, franchise, etc.) should be registered at the rate of 0.5% (based on the gross amount including taxes). In case of agreements with an indefinite duration or for a duration exceeding three years, registration fee is due based on the gross amount related to the first three years.
The Finance Law 2022 provides that acquisitions of immovable properties made by the Government/State are exempted from registration fees. This provision applies to contracts submitted for registration from January 1, 2022, notwithstanding their dates.
Stamp duties are due, in general, on certain contracts expressly designated, as well as invoices, unless the customer is expressly exempt.
In general, stamp duties are TND 0.6 for invoices, subject to exemptions provided for by the law, including invoices related to export operations.
Certain documents are expressly exempt from stamp duties, mainly judgments, checks, etc.
To note that the Finance law 2022 provides that a stamp duty of 100 millimes per receipt issued to customers is due by:
- large commercial areas (as defined by Urban Planning Code) and multi-departments stores that are under the Large Businesses Direction (DGE) or to the Medium-Sized Businesses direction), and
- Operators of a brand or a foreign commercial sign (as defined by law 69-2009 of 12/08/2009 relating to distribution trade).
Social solidarity contribution (CSS)
The CSS is due at a rate of 1% on taxable profit with a minimum due as follow:
|Companies CIT rate (%)||Minimum CSS due (TND)|
|15 or 20||200|
|0 (companies exempted from CIT or that benefit from the full deduction of profits)||200|
The Finance Law 2020 increased the CSS rate for the benefits to be declared in 2020, 2021, and 2022 as follows:
- 3% with a minimum of TND 300 for the banks, financial institutions, insurance and reinsurance companies, and the non-resident credit institutions governed by the code related to financial services destined to non-residents, for the benefits derived from services provided to resident persons and for those derived from services provided to non-residents realised as of 1 January 2021.
- 2% with a minimum of TND 300 for other companies subject to CIT at the rate of 35% (e.g. SICAF, SICAR, debt collection companies, telecommunication operators).
There are no payroll taxes applicable in Tunisia other than those mentioned below (see Social lodging tax and Vocational training tax).
Social security contributions
The Tunisian social security system is financed by contributions from both employers (16.57%, reduced by 0.5% for industrial wholly exporting companies) and employees (9.18%) based on salaries. Employers collect and pay the social security contributions from each wage-earner.
Contributions for work accident and occupational disease are also due by the employer based on employees’ gross income. The rate of such contribution varies between 0.4% and 4% depending on the sector of economic activity.
Social lodging tax
Employers established in Tunisia, regardless of being liable or not to income tax, are subject to a social lodging tax, calculated at 1% of the gross amount of salaries paid to its employees, including benefits in kind.
The social lodging tax is filed on the monthly tax return through which VAT and other direct taxes, except CIT, are filed.
This tax is payable monthly before the 28th day of the following month.
Vocational training tax
Entities subject to CIT are subject to vocational training tax, calculated at 2% of the gross amount of salaries paid to its employees, including benefits in kind. The rate of this tax is 1% for manufacturing industrial companies.
This tax is payable monthly before the 28th day of the following month.
Local authority tax (LAT)
LAT is payable by entities subject to CIT, except entities operating in the tourism sector. The tourism sector is defined as accommodation, entertainment, tourist transportation, thermals, congressional tourism, companies managing hotels and entertainment centres, and travel agencies.
If a company is engaged in several activities, some of which are subject to LAT and the remaining are not subject to LAT, the taxable base to be considered is constituted only by the turnover of the activities that are subject to LAT.
The LAT is paid to the local authority at the rate of:
- 0.2% of the local turnover of the entity, with a minimum calculated on the basis of the number of square metres of construction used by the entity.
- 0.1% of the turnover deriving from exportation as defined by the legislation in force.
LAT is payable monthly before the 28th day of each month.
The hotels tax is due by entities that work with tourists; provide accommodation, food, and beverages; or organise leisure activities for clients. The tax is calculated at 2% of the gross turnover generated from the tourism and relating activities.
This tax is payable monthly before the 28th day of the following month.
Tourism Sector Development Fund (FDCST) tax
The FDCST tax is a tax that is paid by entities operating in the tourism sector. The tax is calculated at 1% of the turnover, excluding VAT, generated from tourism and relating activities.
Hotel residency tax
A hotel residency tax was implemented by the Finance Law 2018. The tax is due by the hotels residents (aged more than 12 years) of the hotels of 2 to 5 stars category as follows:
- TND 1 for each night spent in a 2-star hotel.
- TND 2 for each night spent in a 3-star hotel.
- TND 3 for each night spent in a 4 or 5-star hotel.
This tax is capped at seven nights.
The said tax does not apply to contracts and agreements concluded with travel agencies that have acquired a certain date before 1 January 2018, and it is paid on the basis of a monthly declaration.
The tax is collected by tourist hotels against the issue of a receipt for this purpose. It is paid amongst monthly return within the same deadlines as for the WHT.