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10. INCENTIVES AND SPECIAL REGIMES

Following incentives are available in Burkina Faso:

  • Companies having taxable income, reinvesting all or part of their profits (minimum of XOF 10 million) in a development project in specified sectors in Burkina Faso are, under certain conditions, eligible for tax reductions.
  • The Finance Law 2015 introduced tax incentives to small enterprises subject to CIT under the simplified regime. The Investment Code provides for four separate regimes (A, B, C and D), determined based on the amount invested and a number of jobs created, for the purpose of encouraging “productive investment” in Burkina Faso. Incentives include reduced income-tax, reduced customs duties on certain imports and VAT exemption on the importation or local acquisition of new equipment.
  • The Mining Code provides various incentives for companies carrying on prospecting and mining activities in the country such as -
    • Unabsorbed depreciation can be carried forward indefinitely
    • During exploration, development and exploitation phase, exemption from business license tax, apprenticeship and professional tax and minimum tax
    • CIT exemption in exploration phase
    • Customs duty exemption on equipment, material and spare parts during development phase
    • VAT exemption in exploration and development phase
  • The Finance Law 2014 introduced a special tax regime for economic growth hubs and incentives include exemption from VAT, customs duties and other levies payable on import of goods and services dedicated to the business and a corporate income tax holiday.
  • Reduced customs duties at 5% are applicable on exploration equipment and initial purchase of the spare equipment. VAT exemption applies for new companies on exploration equipment and initial purchase of spare equipment.

Exemption from CIT, business license duties and patronal and apprenticeship tax are available for a period of between five and seven years, depending on the scheme (which depends on the amount of the investment).