HARGEISA–The president of Somaliland H.E Musa Bihi Abdi in a presidential decree number RSL/XM/WM/222-186/082018 has canceled the waiver of taxes on businesses following widespread abuses. The head of state went further to reveal that revenue collections in the country have dropped following rampant abuses.
The president said that the laws guiding waiver of revenue to organizations, businesses and individuals have to be reinforced to seal loopholes that are being exploited by unscrupulous people. He added a new law that will categorize tax waiver for organization and business will soon be in place to stop tax evasion.
The head of state said that it has come to his attention some foreigners purportedly pretending to bring aid into the country were abusing the revenue waiver system by importing goods and flooding them in the market.
The president said from today henceforth:
- Government ministries and institutions have no power whatsoever to waiver taxes for any individuals.
- Tax waiver should follow article 136,145 and 163 of the customs laws of Somaliland.
- The companies which have been exempted from paying import tax will have to pay for income tax, sale tax and profit tax.
- The ministry of finance will come up with a model system of tax collections that will seal loopholes which are being abused.
- The government will promote the country industrialization process by deduction of import tax of companies trying to establish factories. They companies should liaise with the ministry of commerce, industry and tourism to state the type of industry they want to create.
- Companies wishing to set factory in Somaliland will be eligible for $250,000 custom import duty waiver and should employ at least 30 people.
- Raw material will be exempted from tax for three years. The government also orders that raw materials that could be found locally needs not to be imported.