The Portuguese Tax and Customs Authority is supporting its counterpart in Angola in preparing the introduction of Value Added Tax (IVA), scheduled for 1 July, Portuguese daily newspaper Público reported.
Portugal, with 32 years of experience in VAT, has cooperated and provided technical support, even more in recent months, with tAngolan technicians attending training at the IVA department of the Portuguese Tax and Customs Authority.
The entry into force of IVA in Angola was originally scheduled for 1 January, 2019. However, given the introduction is such a major change, the Angolan government decided to postpone it for six months, also at the request of businesspeople because it is the “biggest fiscal reform the country has seen,” according to Adilson Sequeira, chief of oversight of large taxpayers in the Angolan AGT and coordinator of the project of the IVA project.
The introduction of IVA will happen in two stages, considering the economic and social structure of the country, where the levels of informality are very high and not all companies and small-scale traders would be prepared to implement it overnight (three years ago, the Government estimated that the parallel economy accounted for 60% of GDP).
In an initial phase, in 2019-2020, the companies registered in the Large Taxpayers Office are obliged to start charging IVA – about 400 companies (including companies that are part of Sonangol, for example).
From 2021, IVA will be mandatory, but, even then, only for companies with turnover of more than US$250,000.
Unlike Portugal, where there are three IVA rates, Angola will only have a single rate of 14%, which will be a simpler system for both companies and consumers, and for the tax administration itself.
There are many products that will be exempt from VAT, including medicines and medical services, fuels and goods included in the so-called basic basket, such as milk, rice, beans, oils, flour and sugar. (macauhub)