Insights on the fiscal laws and how to make them more conducive to business

In America it is said that there are two things you can count on; death and taxes. Whether you want to or not, it is a civic duty to pay taxes on earnings. In return, the government provides needed services, security, public schools, hospitals, roads and bridges to name a few. While it is acknowledged that the government’s most significant revenue stream is taxes, what is not acknowledged is where the money goes?

“There is a big difference between tariffs (custom duty and VAT) of FCMP (Animal Fat – Milk Powder) and IFFMP (Vegetable Fat – Milk Powder). While the former has a rate of 10% custom duty and exempt from VAT, the latter has a rate of 30% custom duty and VAT at 19.25%. Since IFFMP is always cheaper (in International markets) than FCMP, if we have similar duty structures and no TVA on IFFMP (as we have on FCMP), it will allow importers to bring in milk at cheaper prices. And this will help in reducing the operating cost of Yogurt Manufacturers and Biscuit Manufacturers in this country. Countries like Senegal, Nigeria, and Chad allow imports of IFFMP and FCMP at similar duty structures. This would lead to availability of milk and milk products in the country at quite affordable prices.”
Sujay Sarkar-Olam

(From l-r) Jean- Philippe Guillaume GM/, SGBC, David Ware Country Manager /Maersk, Laure Djoukam, CEO/ Carrières du Moungo
This well attended luncheon by 47 members of AmCham and officials from the Embassy was an intense exchange with Principal Tax Inspector Claude Sylvain Ngneba.
In characteristic bluntness, audience members voiced their malaise. Top offenders were the number and frequency of procedures, high import duties, the high tax base and perceived corruption. Irregularities with VAT on similar items were mentioned by Sujay Sarkar of Olam.

Barrister Eben revealed that when a penalty is levied, there’s no receipt of payment. But if the tax payer highlights the discrepancy, the tax man might further penalize and ask that a 100% penalty be paid! Inspector Ngneba seemed incredulous about such a claim and defended that the tax payer should insist on a receipt!

(From l to r) Joseph Biyiwoh, MD G4S, Barrister Emmanuel Eben, (Ebon & Eben Law Firm,   Maureen Onyango, Country Manager /Kenya Airways
Evidently theory and practice are worlds apart. No one seemed convinced that tax authorities take responsibility for their spoiled image. The point of inviting the tax office was to become better informed on the actual laws, clarify insufficiently explained procedures and improve relations with the tax authorities.
Not much has changed this year except for those investing. If you are thinking about investing in Cameroon, consider the value of the investment and if it will create a large number of jobs.  If so you may see advantages.  The Cameroonian government deems the development sectors such as energy, tourism, housing and agro business as strategic investments.  For the first two years of operation there is an exemption from paying the patent and incorporation fees among others.
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Educating the public in general is needed. However when paying taxes you have the right to know what is being paid and how much is being paid, in black and white. Better still, consult your tax code.
Meanwhile, AmCham has requested a working session with the General Manager of Taxes as a platform for AmCham’s suggestions on enhancing future finance laws. We remain at the entire availability of the tax authorities with the hope that a first meeting will take place before year’s end. We’ll keep you posted!