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Angola

Country Name: Republic of Angola
Currency: Angolan Kwanza (AOA)
Primary Tax Authority: General Tax Administration (Administração Geral Tributária, AGT)
Key Legislation:

  • Income Tax Code
  • Value Added Tax (VAT) Law
  • Customs Code
  • Investment Law
  • Tax Procedures Law

Fiscal Authority Allocation

Centralized Fiscal System:
Angola operates a centralized tax system. The General Tax Administration (AGT) is responsible for the administration and collection of taxes, including corporate income tax (CIT), personal income tax (PIT), value-added tax (VAT), and customs duties.

Corporate Income Tax (CIT)

Standard Rate: 25%
Angola imposes a corporate income tax rate of 25% on resident companies and non-resident companies with a permanent establishment in the country. Special tax rates apply to companies operating in the oil and mining sectors.

Corporate Forms and Taxation:

  1. Resident Companies: Taxed on worldwide income.
  2. Non-Resident Companies: Taxed only on Angola-sourced income.

Exemptions and Incentives:

  • Investment Incentives: Under Angola’s Investment Law, tax holidays, customs duty reductions, and VAT relief are offered to companies investing in priority sectors such as agriculture, manufacturing, mining, and renewable energy.
  • Special Economic Zones (SEZs): Companies operating in SEZs benefit from CIT exemptions, customs duty reductions, and VAT exemptions for up to 10 years.

Goods and Services Tax (GST) / Value-Added Tax (VAT)

Standard Rate: 14%
Angola imposes VAT at a standard rate of 14% on most goods and services. VAT applies to both domestic production and imports.

Exemptions:
Certain goods and services, such as healthcare, education, and financial services, are VAT-exempt. Exports are zero-rated, allowing businesses to reclaim VAT paid on inputs used in producing export goods.

Personal Income Tax (PIT)

Progressive Rates:
Angola applies a progressive personal income tax system to residents’ worldwide income and non-residents’ Angola-sourced income.

Resident Tax Rates for 2023 (Monthly Income):

  • Up to AOA 70,000: 0%
  • AOA 70,001 to AOA 100,000: 10%
  • AOA 100,001 to AOA 150,000: 15%
  • AOA 150,001 to AOA 500,000: 20%
  • Above AOA 500,000: 25%

Non-Resident Tax Rate:
Non-residents are taxed at a flat rate of 15% on Angola-sourced income.

Deductions and Allowances:
Deductions are available for pension contributions, social security, and certain personal expenses, such as medical costs and charitable donations.

Additional Mandatory Contributions

Social Security Contributions:
Employers and employees must contribute to Angola’s social security system, which covers pensions and healthcare benefits.

  • Employer Contribution: 8% of gross salary.
  • Employee Contribution: 3% of gross salary.

Withholding Taxes

  • Dividends: 10% for residents, 15% for non-residents
  • Interest: 10% for residents, 15% for non-residents
  • Royalties: 15%
    Angola imposes withholding taxes on payments to non-residents, including dividends, interest, and royalties. Withholding tax rates may be reduced under Angola’s double taxation agreements (DTAs).

Transfer Pricing Rules

Angola follows the arm’s-length principle for related-party transactions. Companies must ensure that cross-border transactions between related entities are conducted at market value. Transfer pricing documentation is required for multinational companies operating in Angola.

Special Tax Regimes

  • Special Economic Zones (SEZs): Companies operating in SEZs benefit from CIT holidays, customs duty exemptions, and VAT relief. These zones are designed to promote export-oriented industries and attract foreign direct investment.
  • Investment Incentives: Angola’s Investment Law provides tax holidays, reduced CIT rates, and customs duty exemptions for companies investing in sectors such as agriculture, infrastructure, and renewable energy.

Other Taxes

  • Customs Duties: Angola applies customs duties on imports, with rates ranging from 2% to 30%, depending on the type of goods. Raw materials and essential goods may qualify for reduced or zero customs duties.
  • Excise Taxes: Excise taxes are levied on goods such as alcohol, tobacco, petroleum products, and luxury items.
  • Property Tax: Angola imposes a property transfer tax (SISA) at a rate of 2% on the sale of property.

Double Taxation Agreements (DTAs)

Angola has signed several double taxation agreements (DTAs) with countries such as Portugal, the United Arab Emirates, and China. These agreements help reduce withholding taxes on cross-border income and prevent the double taxation of income earned in Angola and other jurisdictions.

Local Taxes

Local governments in Angola may impose minor taxes such as property taxes, business registration fees, and local service levies. However, most major taxes, including CIT, PIT, and VAT, are centrally administered by the General Tax Administration (AGT).

Compliance and Reporting

Annual Filing:
Corporate tax returns must be filed within four months following the end of the financial year. Personal income tax returns are generally due by March 31st. VAT returns are filed monthly, depending on the size of the business.

Penalties for Late Filing:
Penalties for non-compliance or late filing include fines and interest on unpaid taxes. The AGT imposes interest at a rate of 2% per month on overdue taxes, with additional penalties for tax evasion or underreporting.

Recent Developments

Focus on Oil and Gas:
Angola’s economy is heavily reliant on its oil and gas sector. The government is encouraging investment in oil exploration and production by offering tax incentives such as CIT reductions, customs duty exemptions, and VAT relief for companies operating in the sector.

Renewable Energy Initiatives:
Angola is promoting investment in renewable energy, particularly solar and wind energy. Companies investing in renewable energy projects benefit from CIT holidays, VAT exemptions, and customs duty reductions.

Digital Economy and E-Government:
Angola is working to modernize its tax administration through the introduction of electronic tax filing and payment systems. This effort is part of a broader strategy to improve tax compliance, transparency, and efficiency.

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