Under Angola's State Budget proposal for 2018 (the Budget proposal), which is currently being discussed by the Parliament, a legislative authorization would be granted to the Executive Branch, with the purpose of performing specific amendments to the current Angolan tax system.

Specifically, the following tax codes and regulations would be covered by the aforementioned legislative authorization:

• Customs Code
• Personal Income Tax Code
• Industrial Tax Code
• Investment Income Tax Code
• Consumption Tax Regulation
• Stamp Duty Code
• Urban Property Tax Code
• Inheritance and Gift Tax and Real Estate Transfer Tax Code

Key proposed amendments to the respective tax codes include:

• Introduction of a mechanism for the settlement of tax, by means of withholding, on purchases of goods from small businesses by companies that have organized accounting records and are subject to Industrial Tax
• Extension of the list of professions annexed to the Personal Income Tax Code
• Review of the Industrial Tax autonomous taxation regime
• Improvement to the indirect methods tax framework
• Amendments to the current Investment Income Tax exemption regime (i.e., "participation exemption") on the distribution of profits to Angolan entities subject to Industrial Tax
• Extension of the reverse charge mechanism applicable for Consumption Tax purposes, currently applicable in the Oil & Gas sector, to the financial, telecommunications and non-oil mining sectors
• Extension of the application of Stamp Duty to the employment contracts of foreign nonresident individuals
• New rules for the Stamp Duty tax liability regime
• Amendments of the Consumption Tax incidence rules, namely on advertising services
• Imposition of Urban Property Tax on sales' agreements and in similar situations that imply the utilization of the property
• Imposition of Urban Property Tax to all situations of use of the property due to the transfer of a contractual position, mere fruition and possession, even without proper title
• Imposition of Consumption Tax on the issuance of air and sea transportation tickets, for routes to be carried out entirely in the national territory
• Imposition of Stamp Duty on the collections' receipts of independent workers

Finally, it is also envisaged that the Special Contribution on Foreign Exchange Transactions will be maintained, without any changes to the respective regime.

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CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young Angola, Limitada, Luanda

• Luís Marques
  luis.marques@pt.ey.com
• Rui Henriques
  rui.henriques@pt.ey.com
• António Pereira
  antonio.p.homenio.pereira@pt.ey.com

Ernst & Young Advisory Services (Pty) Ltd., Africa ITS Leader, Johannesburg

• Justin Liebenberg
  justin.liebenberg@za.ey.com

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ATTACHMENT

PDF version of this Tax Alert