Angola’s tax administration can now collect taxes in foreign currency from some companies, per the terms of a change in the Angolan General Tax Code approved in May which took force on 17 August after enactment by the president of the republic.

The change approved by the National Assembly aims, according to the enactment order, to create “conditions whereby under certain conditions taxes can be paid in foreign currency.” The main advantage is to “increase the availability of monetary resources in currencies in the state’s favour.”

Henceforth and “exceptionally at the taxpayer’s request or on its own initiative in cases where more than 60 percent of the taxpayer’s total income resulted from gains in foreign currency during the financial year in question, the tax can be settled and paid in foreign currency,” the order reads.

The law’s new text indicates that it will now be possible for the Tax Administration to use “mechanisms for compensating tax credits with non-tax debts after prior acknowledgement of the debt by the Public Debt Management Unit.”

The legislative initiative was put forward by the government. As he defended at an earlier, date, Finance Minister Archer Mangueira said it was justified for geopolitical and situational reasons “which impose redoubled efforts on emerging economies.”

“The aim is actually to enable the state to gather more resources through tax payments in foreign currency, thus reducing pressure on the balance of payments and spending abroad,” said Mangueira, cited by Lusa news agency. (Macauhub)