CABO VERDE Law and Practice Contributed by: Nelson Raposo Bernardo, Joana Andrade Correia, Manuel Esteves de Albuquerque and Júlio Martins Júnior, Raposo Bernardo & Associados
Contractual Tax Benefits There are exceptional incentives – regarding customs duties, CIT, PIT, property tax and stamp duty – for investments that fulfil all of the following conditions. • The promoter of the investment possesses techni - cal and managerial capacities. • The invested amount exceeds CVE3 billion (EUR27,207,183). The relevant amount is CVE1.5 billion (EUR13,603,591) for investments located in a municipal area where the average GDP per capita is lower than the national average (with reference to the last three years). • They create, directly, at least 20 qualified jobs (ten in the case of investments located in a municipal area where the average GDP per capita is lower than the national average, with reference to the last three years). A qualified job requires professional or higher education, or specialised technical training, certified by a national or foreign entity, including management positions. The concession of contractual tax benefits is subject to approval by the Council of Ministers upon agree - ment. Differentiated Merit Projects (DMP) DMP status was established by Law 80/IX/2020, of 26 March, and is granted to investments that cumula - tively meet the following requirements, among others: • represent an investment equal to or higher than CVE1.5 billion (EUR13,603,591); • contribute, in net terms, to the improvement of the balance of payments; • use technology, production and commercialisation processes that minimise environmental impacts or promote environmental sustainability; and • have a recognised productive social effect, par - ticularly in the creation of at least five qualified jobs (those that require specialised technical training, either professional or of higher education, including management positions). Investment projects with DMP status are granted the following benefits:
• quarries or any other places of natural resource extraction are involved; or • it carries out its activity in Cabo Verde through: (a) employees, or any other personnel hired for that purpose, for a period (continuous or not) of not less than 183 days within a 12-month period; (b) a person (a dependent agent) who is not an independent agent acting in the Cabo Verdean territory on behalf of a company, with powers to intermediate and conclude binding contracts for that company, within the scope of its busi - ness activity; or (c) a building site or a construction installation if it lasts for more than 183 days, as well as activi - ties of co-ordination, supervision and inspec - tion related to the building site or its construc - tion installation. A PE is also recognised in the case of: • commissionaire arrangements; • preparatory or ancillary activities carried out by closely related enterprises through a fixed installa - tion; and • independent agents acting exclusively, or almost exclusively, on behalf of one or more closely related enterprises. A PE of a non-resident is taxed as a resident company. 5.3 Available Tax Credits/Incentives Foreign Investor Status (Estatuto do Investidor Externo) Foreign Investor Status previously granted some tax benefits at the level of the investor (eg, exemption from WHT on distribution of profits and on interest related to the financing of the investment), but was revoked by the New Investment Law effective as of 1 January 2013. Those tax benefits already granted, or for which recognition has been requested prior to the entry into force of the Tax Benefits Code and the Investment Code, are maintained. Investment projects submitted for analysis and approval to the competent authorities prior to the entry into force of the Tax Benefits Code continue to be regulated under the legislation in force at the date of their respective submissions.
130 CHAMBERS.COM
Powered by FlippingBook