PRESS REVIEW OF 05 DECEMBER 2019
FIGHT AGAINST ILLICIT FINANCIAL FLOWS: Signing of an agreement in view (THE TRUTH): Transparency and data sharing. Madagascar is committed to the African Union’s Agenda 2060 on combating illicit financial flows (Ffis). A delegation led by Richard Randriamandrato, Minister of Economy and Finance and composed of the Director General of Taxes, Germain, the Director of Tax Legislation and Litigation Miandry Rakotondramanana, as well as Hajarivony Andriamarofara of the World Bank, attended the meeting as part of the 10th anniversary of the World Forum. The event took place on 26-27 November in Paris, at the OECD Conference Centre or Organisation for Cooperation and Development.On the sidelines of this forum, the Directorate-General for Taxes (DGI) also approached the African Union’s Commission for Economic Affairs. Discussions focused mainly on combating illicit financial flows, including tax evasion and smuggling. An agreement is in sight to materialize Madagascar’s ambition in terms of recovery in tax collection. “We anticipate ratification of this convention this month. Its signature will enable DGI to obtain information on the financial movements of multinational companies (Fmns) located in the country.
20% CORN AND BLE TAXATION: “No impact on market prices” (THE TRUTH): Under consideration in the Senate. The Finance Bill (PLFI) 2020 creates at this time a great controversy with local operators. The focus of the discussion is on the value-added taxation of corn and wheat. Agriculture and livestock professionals are concerned that prices of these products and their derivatives, such as feed, may rise. Questioning the subject yesterday in Antaninarenina, Mr Germain, Director General of Taxes (DGI), says the opposite. According to him, this taxation does not affect the price of maize on the domestic market. 80% of the population live on agriculture and livestock. The majority of them are farmers.
The law stipulates that enterprises with an income of 200 million ariary are subject to VAT, which is not the case in the informal sector. For the SIM, these provisions run counter to the challenge of developing industrialization and kill the Malagasy industry which is currently struggling to keep up with the abundance of import products in the territory. The opacity of the allocation of certain provisions contained in the bill is one of the points criticized by the CCOC.
The confirmation of the Minister of Communication and Culture is confirmed by the initial finance bill for 2020 which provides for a Senate with 18 members against 63 who compose the current upper house with majority HVM.