23 January 2019 Algeria's 2019 Finance Bill introduces new tax measures Algeria's 2019 Finance Bill (the Act) came into force as of 1 January 2019. Despite no increase in tax rates, the Act introduced, as well as amended, several measures targeting increased fiscal revenues through expanded tax bases and tighter control mechanisms. Article 2 – Deductibility of costs related to technical assistance provided by foreign suppliers is limited to:
Deductibility of interest on loans paid to shareholders or related companies is limited at the average effective interest rate established by the Bank of Algeria. Articles 16 and 17 – Entities subject to the obligation of submitting transfer pricing documentation may be requested by the tax authorities to provide complementary documentation that includes tax rulings and Advance Pricing Agreements obtained by the group in other jurisdictions, notably in the frame of an Audit. Article 6 – Obligation for taxpayers to authenticate prior to any payment, the fiscal and trade identification numbers of their commercial partners (third parties). Article 7 – Imposition of a fine amounting to 50% of each transaction against taxpayers violating the dispositions of Article 6. Article 10 – Introduction of a 5% withholding tax (covering all taxes), applicable to legal and physical sales operations via the internet or numerical platforms. Article 15 – Taxpayers subject to tax audits, must provide, at the request of tax inspectors, an accounting entry file containing the details of all accounting operations recorded during the audited fiscal years. This file is intended to help the tax auditors verify the company's books, without systematically using their own software, by standardizing the taxpayers' books format. Articles 19 and 20 – Litigations related to Tax Debt Collection disputes are now receivable by local and regional tax inspections and not only at the level of the regional (Wilaya) and Large Companies Directorate (DGE). Ernst & Young Tax & Legal Algérie, Head of Africa desk – Maghreb and Francophone Africa and Head of Algeria Tax Practice, Alger Document ID: 2019-0203 |
