21 February 2013

Mozambique: Modernisation of Tax System Discussed

Maputo — As from late 2014, Mozambican individuals and institutions will be able to submit their annual tax declarations online, and pay their taxes electronically.

Currently taxpayers are obliged to queue up at the tax offices to deposit their declarations, and to pay. Payment must be by cash or cheque, since the tax offices do not possess the facilities for the use of credit or debit cards.

However, the Mozambican Tax Authority (AT) promises that this will all change under the “e-taxation” project under implementation since 2011, under which computerized systems will be used in modular form to manage tax payments.

At a seminar to brief private businesses on the matter, the project manager Atumane Muenhe said that all information on taxpayers will enter a computerised data base that can be accessed anywhere in the country.

The first module to be implemented is the registration of individual tax numbers (NUITs). But far from making life simpler for taxpayers, this threatens to complicate matters, since all the people who already have NUITs will be expected to re-register and fill out new forms.

The next phase will be to introduce the main taxes into the system – notably corporation tax (IRPC), personal income tax (IRPS) and Value Added Tax (VAT).

“As from 2015, we shall include other taxes in the system”, said Muenhe. “The computerisation of taxation will bring great benefits. The taxpayers will be able to submit their declarations through the Internet, and make their payments electronically. This will reduce the time spent travelling to tax offices, and provide more transparent administrative procedures”.

The participants at the seminar were in principle in favour of modernising tax management through the use of new technologies, but warned that care should be taken about the quality of the technological systems used.

They also pointed out that much of the country still has no internet access, and that many districts have no banks. These were factors that the e-taxation project needed to take into consideration.

The AT’s General Director of Planning, Studies and International Cooperation, Herminio Sueia, stressed that the dynamism of the Mozambican economy in recent years requires a response in terms of modernising tax management, which will produce gains for both the state and the taxpayer.

He said that the use of information and communications technologies to manage taxes is the only viable way to create an internationally competitive business environment.

“Aware of its responsibilities, the AT has banked on developing information and communications systems to respond to the challenges it faces in the current conjuncture”, Sueia added. “The AT is at the phase of reform in order to facilitate and simplify compliance with tax obligations, and thus to improve the business environment and expand the tax base. The corollary of this is the optimization of tax collection, in order to undertake public expenditure”.

For his part, the Deputy Chairperson of the Confederation of Mozambican Business Associations (CTA), Agostinho Vuma, said that modernizing the tax system will strengthen Mozambique’s ability to attract foreign investment, and will make tax affairs easier for small and medium companies.

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