UPDATE 1-Ivory Coast to increase telecoms taxes, regulations

Tue Feb 4, 2014 2:49pm EST

* Tax on business profits to increase to 30 pct from 25

* Companies to purchase local bonds to keep profits in country

* Govt targets $3.30 billion in 2014 tax revenues (Adds details, quotes and background)

By Loucoumane Coulibaly

ABIDJAN, Feb 4 (Reuters) - Ivory Coast will increase taxes on telecoms companies and require them to invest in government bonds this year as part of efforts to boost fiscal revenues and keep profits in the country, the state tax agency's director said on Tuesday.

Ivory Coast, French-speaking West Africa's largest economy, is emerging from a decade-long political crisis that ended in 2011 and has launched an ambitious post-war economic development programme.

The Directorate General for Taxes is targeting overall tax receipts of nearly 1.6 trillion CFA francs ($3.30 billion) in 2014, up from 1.4 trillion CFA francs last year, to boost reconstruction, the head of the agency Pascal Abinan said.

"The information and communications technologies sector is in full expansion and is generating a lot of money. We're going to make it so the sector can contribute to the country's development," he told a press conference in Abidjan.

He said the tax on business profits for telecoms companies will be raised to 30 percent from 25 percent.

With a population of around 24 million, Ivory Coast has around 20 million mobile phone users. Its five existing operators are France Telecom's Orange, South Africa's MTN, Libya's Green, Etisalat's Moov and Koz, part of Lebanon-based Comium.

Domestically-owned Cafe Mobile was granted a licence in 2012 but has yet to begin operating. Abu Dhabi-based Warid Telecom also holds an unused operating permit.

Abinan said the sector's overall turnover was forecast at over 1 trillion CFA francs in 2013, up from 850 billion CFA francs the year before and 744 billion CFA francs in 2011, but too much profit was being transferred out of the country.

"All companies in the sector that transfer dividends out of Ivory Coast will be obliged to subscribe to treasury bills of a value equivalent to 20 percent of the amount transferred," he said.

Consumers will also pay a three-percent tax on the cost of calls, Abinan said. Meanwhile, taxes on alcohol and tobacco products will also rise.

Ivory Coast is aiming to boost tax revenues to 2.5 trillion CFA francs within five years as it reorganises its tax administration and clamps down on tax fraud. ($1 = 485.2290 CFA francs) (Reporting by Loucoumane Coulibaly; writing by Joe Bavier; editing by Bate Felix and Keiron Henderson)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.