31 July 2021
The Angolan government is considering revising the taxation regime that applies to fuel exports. The proposal by José Alexandre Barroso, Secretary of State for Oil and Gas, to raise the tax rate to 230 percent has been submitted to the Brazilian parliament for approval in accordance with the presidential decree.
When compared to other markets on the African continent, domestic fuel prices in Angola are lower; for example, a liter of gasoline costs 160 kwanzas ($0.25) and a liter of diesel costs 135 kwanzas ($0.21), whereas prices for the same amount of fuel in neighboring countries can reach $1 or higher, making Angola an appealing destination for smugglers. The government is confident that, with the proposed tax increase and robust border control measures, it will be able to provide much-needed assistance in the fight against fuel smuggling from Angola to neighboring countries.
“We want to grow and become a strong industrial market in Africa, and the first step toward achieving these objectives is to protect the national economy. We must take the necessary steps today to protect business and reassure future investors that the government is committed to fair play and good practices that foster a favorable business environment,” Barroso stated in his speech.
Angola imports approximately 80% of the fuel it consumes domestically. Importing three million metric tons of fuel cost the country $1.7 billion in 2019, according to official figures.