The Gabonese Finance Law for 2016 (Law No. 021/2015) (hereinafter 2016 FL) was enacted on 1st February 2016.
The main measures, effective as from 1st January 2016, concern the following taxes:
i. Branch remittance tax
2016 FL increases the rate of the branch remittance tax on net after-tax profits from 15% to 20%.
ii. Withholding tax (WHT) on service fees to non-residents
Subject to double taxation treaties, the WHT rate on fees paid to non-residents in consideration for services of any kind used or provided in Gabon increases from 10% to 20% of the gross amount paid (VAT excluded).
Output VAT on services provided in-country by non-resident providers shall, from now on, be non-deductible from input VAT for the resident beneficiary paying for the services, thus rendering such VAT final for the latter.
iv. Simplified Tax Regime (STR) applicable to oil subcontractors
The preferential tax rates for oil subcontractors subject to the STR shall be revised every 2 years instead of 3.
The Gabonese authorities seem to be trying to increase the budget revenue while discouraging the resort to non-resident service providers in an attempt to boost the local economy.
Please feel free to contact us if you need any further information regarding the above: