Burkina Faso's Ministry of Finance has published the Finance Law for the 2023 Budget (Law No. 029-2022/ALT), which was originally promulgated on 30 December 2022. The Ministry of Finance has also published an overview of the tax measures included in the law.
One of the key measures is the introduction of Country-by-Country (CbC) reporting requirements in line with OECD guidelines, which apply for MNE groups with consolidated annual revenue of at least XOF 491 billion in the previous year. When required, CbC reports must be submitted electronically within 12 months following the end of the reporting fiscal year using a template prescribed by the tax authority.
Other measures include:
- A new "non-determined" or "undetermined" tax regime for taxpayers not classified in any other tax regime, with all payments to such taxpayers for the sale of goods and/or services subject to withholding tax at a standard rate of 20%, with certain reduced rates:
- 10% for payments to employees that occasionally perform intellectual services;
- 2% when the payment is made to a non-professional and non-salaried individual who performs manual services; and
- 5% for payments to public entities;
- A 5% withholding tax on all public orders, with a reduced rate of 1% provided for supplies of goods and services and a 0.2% rate provided for hydrocarbons and phone top-up (recharge) cards;
- A reduced withholding tax rate of 10% on payments to service providers not resident in Burkina Faso but residing in the ECOWAS region;
- A reduction in the real estate transfer tax (duty) rate from 8% to 5%;
- A VAT withholding obligation for exporting companies, which are required to withhold and remit 20% of the VAT due on their purchases of goods and services;
- New rules to allow resident companies to enter into advance pricing agreements with the tax authority with a term of up to 4 years;
- An obligation for non-residents to appoint a resident tax representative in relation to all taxes due by a non-resident, which is an extension of the existing obligation to appoint a tax representative for the fulfillment of VAT reporting and payment;
- A penalty equal to 25% of the amount collected by a seller that accepts payments for goods and services in cash exceeding XOF 100,000 (penalties already apply for buyers making cash payments exceeding XOF 100,000); and
- A requirement to attach a detailed statement on bad debt losses to the annual tax return.
The measures of the law are effective from 1 January 2023.