Are you wondering how the 2025 Finance Act in Madagascar will affect your business? What impact will these new tax provisions have? Explore the key changes and their implications for taxes, levies, and regulations affecting businesses and individuals in Madagascar.
Key Updates in the 2025 Finance Act
The 2025 Finance Act in Madagascar brings significant changes to the tax landscape. Here are the main highlights:
- Income Tax (IR): Applicable to Malagasy tax residents, properties located in Madagascar, and Malagasy-sourced income. Expanded deductibility for internship allowances and intra-group interest under specific conditions.
- New Tax on Mobile Transactions: Introduction of a 0.5% tax on domestic and international transfers exceeding 150,000 MGA, declared monthly to the relevant authorities.
- Invoice Compliance Requirements: Mandatory issuance of invoices in duplicate, including transactions by non-resident service providers.
- Major Sectoral Reforms: Implementation of a special tax regime for large investments in the Malagasy mining sector.
- Strengthened Tax Penalties: Fiscal card suspension for severe non-compliance with declaration or payment obligations.
New Regulations for Businesses
Businesses must adhere to specific provisions, including:
- Split Payments for Property Taxes: Payments for IFT and IFPB must be declared no later than October 15 each year.
- Intermittent VAT Obligation: Applicable to foreign service providers conducting operations in Madagascar.
- Separate Accounting Requirement: Mandatory for agricultural and forestry activities.
- Tax Registration: Required for entities operating under permits in the mining and tourism sectors.
Adjustments for Individuals and Employers
- Suspension of Taxation on Volunteer Allowances.
- Changes to Capital Gains Taxation: Adjustments to the tax base for real estate capital gains.
- Enhanced Anti-Fraud Measures: Revised fines to combat tax evasion.
Simplified Procedures and Recoveries
- Simplified Recovery Processes: International assistance facilitates the recovery of foreign tax claims.
- Elimination of Distance-Based Deadlines: Removal of the application of distance-related timeframes in tax matters.
Prepare now for the changes introduced by Madagascar’s 2025 Finance Act! Contact our experts for personalized guidance tailored to your needs.