DRC Law and Practice Contributed by: Serge Nawej Tshitembu, Xavier Huberland, Daniel Yamba and Katerina Papachristou, ProximA International
Finally, the trade union delegation operates in accordance with internal rules and proce - dures, jointly established with the employer and approved by the Labour Inspectorate. 5. Tax Law 5.1 Taxes Applicable to Employees/ Employers In the DRC, personal income tax on salaries is governed by the General Tax Code (CGI – Code Général des Impôts ), particularly Articles 89 to 104. The employer is required to withhold income tax at source under a progressive scale, with rates ranging from 0% to 40% depending on income levels. In parallel, social contributions are governed by Ordinance-Law No. 69/011 of 10 February 1969, as amended. Employers must contribute to the INSS, ONEM and INPP, repre - senting over 12% of gross salary, while employ - ees contribute approximately 3.5%, deducted monthly. Registration and monthly declarations with the CNSS and tax administration are man - datory. 5.2 Taxes Applicable to Businesses Corporate income tax is levied at a fixed rate of 30%, as established by Article 97 of the CGI. Resident companies are taxed on global income, while non-residents are only taxed on income deemed to have a Congolese source under Arti - cle 4 of the CGI. Value-added tax (VAT) is regu - lated by Law No. 10/001 of 20 August 2010, with a standard rate of 16%, though exemptions or reduced rates apply to certain goods and servic - es. Withholding tax on outbound payments such as dividends, interest, royalties and director fees is set at 20% under Articles 92 to 96 of the CGI, except where a double taxation treaty applies – currently limited to agreements with Belgium and South Africa. Capital gains are not subject to
a separate regime; they are treated as ordinary business income and taxed at the standard rate. Income sourced abroad is not taxable unless linked to a local permanent establishment, as clarified in Article 6 of the CGI. The DRC has not yet adopted OECD Pillar Two rules, and there is currently no domestic minimum top-up tax. 5.3 Available Tax Credits/Incentives Tax and customs incentives are granted under the Investment Code. Projects approved by ANAPI may benefit from tax holidays, customs exemptions and VAT relief during the start- up phase. To qualify, investors must submit a detailed application including a feasibility study, projected socio-economic impact and proof of environmental compliance. The scope and duration of benefits are determined based on the project’s location, sector, and alignment with national development priorities, as set out in Articles 8 to 12 of the Investment Code. In addition to the general investment regime, sector-specific incentive frameworks apply in mining and hydrocarbons. Under the Mining Code, titleholders benefit from customs exemp - tions on eligible goods and equipment during the research and construction phases (Article 220). They are also entitled to stability clauses protecting their fiscal and customs regimes for a period of five years after the commencement of commercial production (Article 276). Similar provisions are found in the Hydrocarbons Law (Law No. 15/012 of 1 August 2015), which grants contractors and titleholders exemptions from duties and taxes on imported goods, services and equipment used for exploration and devel - opment activities (Articles 68 and 69), along with guarantees of tax stability for up to ten years depending on the contract structure.
241 CHAMBERS.COM
Powered by FlippingBook