(Business in Cameroon) - On June 20, 2018, Paul Biya, Cameroon’s president signed a circular setting the major points of the 2019 budget.
In the circular, the president prescribed that in 2019, fiscal revenues should be optimally mobilized. Among the measures which should contribute to that effort, there is the “reduction of the tax expenditures by CFA100 billion in 2019, thanks to the progressive suppression of indirect tax incentives”. According to that directive, a progressive tax will be imposed on products which were not taxed before.
Let’s remind that such measure for the enlargement of the tax base was prescribed in the 2018 fiscal law but the government desisted. Indeed in the 2018 fiscal law which was submitted to the national assembly in November 2017, the government prescribed 5% exit duty on the following products: acacia gum, rice, palm oil, pepper, kola nut, millet, sorghum, and Eru.
In the final law, however, the 5% tax on wheat imports was waived following instructions from the presidency.
Let’s remind that this tax base enlargement was prescribed by IMF in the framework of the economic program it signed with Cameroon in June 2017. Indeed, the Bretton Woods institution has always reminded CEMAC countries that they should cancel discretionary waivers since they affect the countries’ overall revenues and undermine growth.
S.A