GUINEA Law and Practice Contributed by: Sarah Razafindrafito and Tiavina Rakotonaivo, John W Ffooks & Co
for which they benefit from the exemptions provided for in the foregoing, including but not limited to: • VAT, excluding on the import of some equipment provided in the mining list in accordance with the provisions of the Mining Code; • the tax on industrial and commercial profits or corporate tax; • the tax on income from securities; • registration dues on deeds relating to company formation, increasing share capital through new capital contributions, capital contributions, the capitalisation of profits or reserves, or mergers; • lump-sum salary payments; • withholding on non-salary income; • withholding on salaries; • the single automobile tax, with the exception of industrial vehicles and equipment at the rate in effect; • contributions to professional training or the appren - ticeship tax, as the case may be; • contributions to local development; • fixed fees and annual royalties; • surface royalties; • tax on the extraction of mineral substances other than precious metals; • tax on the industrial or semi-industrial production of precious metals; • the export tax on mineral substances other than precious metals; and • the export tax on precious stones and gemstones. In addition, the holders of an exploitation title are subject to the payment of environmental taxes and royalties on classified establishments, in accordance with the Environmental Code and its implementing regulations. It is worth noting that there is no specific distinction made between the taxation of national and foreign investors in the Republic of Guinea (Article 176 of the Mining Code). 4.2 Tax Incentives for Mining Investors and Projects The stabilisation of the fiscal and customs regime is guaranteed to holders of mining exploitation titles who have signed a mining agreement. The maximum
duration of the period of stabilisation is 15 years. This period of stabilisation runs from the date on which the mining exploitation title is granted. During this period, the rates of levies, duties and taxes will nei - ther be increased nor reduced. Instead, these rates will remain as they were on the date the mining title was granted. Furthermore, no new tax or levy of any kind whatsoever is applicable to the holder of a min - ing title during this specific period (Article 182 of the Mining Code). 4.3 Transfer Tax and Capital Gains on the Sale of Mining Projects Any transfer of an exploitation permit, mining conces - sion or authorisation to exploit quarry substances is subject to capital gains tax, in accordance with the provisions of the General Tax Code of the Republic of Guinea (Article 91-II). The calculation basis for this capital gain is the difference between the transfer price of the mining title or authorisation stipulated in the deed of transfer and the net book value of the mining title or authorisation. Any transfer of shares or other ownership interest of a legal entity holding a mining title or authorisation is taxed in accordance with the capital gains regime in the Republic of Guinea. The basis of assessment for capital gains on the sale of a share or corporate interests is the difference between the sale price of the share and its net book value. It is worth noting that where the transferor is not established in Guinea, this capital gain is taxed at source in Guinea at the standard rate of corporate income tax under the Gen - eral Tax Code. The tax is deducted at source by the legal entity holding the mining title or authorisation. This withholding tax is payable when the capital gain is realised. Failure to pay the withholding tax due will result in the withdrawal of the mining title or authorisa - tion (Article 91-III). 5. Mining Investment and Finance 5.1 Attracting Investment for Mining The main features of attracting investment for mining in the Republic of Guinea are as follows.
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