Tax Refunds and Economic Growth in Angola
The General Tax Administration (AGT) has made significant progress in refunding Value Added Tax (VAT) to businesses in Angola. As of June this year, a total of 191 billion kwanzas have been returned to companies, according to José Leiria, Chairman of the AGT Board of Directors. This development was confirmed during an address at the 6th edition of the “Conversas Economia 100 Makas” event in Luanda.
Leiria emphasized that these refunds are a result of enhanced tax control mechanisms and the successful implementation of electronic invoicing. He also noted that the target is to increase the amount of VAT refunds to approximately 300 billion kwanzas by 2026.
“VAT came into effect in 2019. We began issuing refunds in 2020 and have followed an upward trend; in other words, each year we are refunding more than the previous year,” he said.
Since the introduction of VAT, a total of 770 billion kwanzas has been refunded to businesses. This reflects the ongoing efforts of the AGT to streamline processes and improve efficiency in tax management. The organization has been working on strengthening verification mechanisms and aligning with tax compliance measures adopted by companies, which has allowed for faster processing of refunds.
Electronic Invoicing: A Game Changer
One of the key initiatives driving these improvements is the adoption of electronic invoicing. According to Leiria, the AGT data currently shows over 58,000 taxpayers issuing invoices electronically, including more than 430 large taxpayers. This shift towards digital processes has significantly increased transparency and efficiency in the tax system.
He added that current data indicates the reporting of 63 million invoices, representing a business volume of 53.4 trillion kwanzas. These figures include 15.84 trillion kwanzas invoiced electronically via the Taxpayer Portal, alongside amounts processed through invoicing software.
The use of electronic invoicing has not only improved the accuracy of tax reporting but also reduced the time required for processing and verifying transactions. This has helped in creating a more reliable and predictable tax environment for businesses operating in Angola.
Supporting New Taxpayers
In addition to these developments, the AGT has been actively engaging with new taxpayers who were previously part of the informal economy. Under the Tax Compliance Induction Program, the AGT is collecting 1.6 billion kwanzas per month from these individuals. This initiative aims to integrate informal businesses into the formal tax system, promoting economic growth and stability.
Leiria highlighted that this program has replaced the previous “Informal Operation” framework, marking a significant step towards better tax compliance and revenue collection.
Role of the General Tax Administration
As the body overseen by the Ministry of Finance, the AGT plays a crucial role in collecting state revenue and managing customs control for the benefit of Angolan society. Its efforts in improving tax administration and promoting compliance have contributed to the overall economic development of the country.
Through its various programs and initiatives, the AGT continues to work towards a more transparent and efficient tax system that supports both businesses and the broader economy.
Key Highlights
- VAT Refunds: AGT has refunded 191 billion kwanzas in VAT to companies up to June this year.
- Electronic Invoicing: Over 58,000 taxpayers now issue invoices electronically, with 63 million invoices reported.
- Tax Compliance Induction Program: Collects 1.6 billion kwanzas monthly from new taxpayers.
- Future Goals: Target of 300 billion kwanzas in VAT refunds by 2026.
