In the Democratic Republic of the Congo, if the fiscal pressure remains in the average of what is practiced in Africa, a bewildering number of taxes, sometimes surprising, prevent the development of the business world.
Officially, the Democratic Republic of Congo (DRC) is the tenth most corrupt country in the world, and the fifth in Africa. The country is home to more than half of the world's copper and cobalt, and has significant reserves of zinc, coltan, gold and diamonds.
An incredible wealth, exploited mainly by foreign companies. A large part of these are content to buy back the resources illegally mined by the locals. These foreign companies get their hands on the mining sites through political agreements, the fault of the great corruption that reigns there. Some, however, crumble under the weight of petty corruption.
Symbol of this petty corruption: taxes. "There are more than 550 different taxes in the Congo," quips a businessman on condition of anonymity. A largely exaggerated figure, the Congolese administration does not list all the taxes, but which shows to what extent the money circulates between the production and the distribution of the products manufactured on the spot.
Decoration taxes, the example of craftsmanship
On February 23, 2013, a list of new taxes was published, following an ordinance-law prepared by former Prime Minister Matata Ponyo Mapon, promulgated by Joseph Kabila. A list so long that few media have thought about it.
Among these taxes, we find for example "decoration taxes", the nightmare of entrepreneurs. To start producing handicrafts in the DRC, the administration requires paying 15 taxes in this relatively recent list. To sell these objects, it is therefore necessary to apply for four different authorizations: the shooting request, the authorization to pay taxes for the production request, the tax on the performance of anonymous works of art and culture. , and the request for an artistic workshop permit. Total cost: $ 680 minimum - in a country where the minimum wage does not exceed $ 44 a month. System anomaly: the amount of two of these taxes is left to the appreciation… of the authorities.
Taxes are raining down on businesses. Who do not imagine that to change their parquet or their paintings, they will have to pay a special tax. And the examples are numerous, of sums claimed by the administration, for usually harmless operations.
A theft in due form?
On the industrial side, an inspector from the General Tax Directorate (DGI) visits a company or a factory at least daily. Some entrepreneurs pay bribes so they don't get bothered. These DGI officials are often responsible for determining the value of the taxes claimed.
And on this level, creativity is still there. Without sampling equipment, inspectors decide whether the product is finished or whether it is raw materials. An essential distinction, because the State levies 2% of the cost of raw materials and 2% of the value of the finished product, not counting personal taxes. And this, without legal distinction between natural and legal persons, as provided by Congolese law.
Add to that $ 20 on every ton of raw materials imported for docking — commonly known as stevedoring. In summary, for the use of cranes in ports, a tax is levied even if the imported products do not require the use of cranes. Worse, some businessmen have to pay for the use of cranes while being forced to use their own cranes, as the port does not have the capacity to provide them with the necessary equipment.
This savage taxation, which in no way inflates the state coffers but generally ends up in the pockets of inspectors, is even more abusive for companies using vehicles. Each company must pay 140 dollars per month per vehicle, whether it is a large displacement, a service car or a semi-trailer.
There is also a tax for employees in industrial enterprises. It amounts to 7% of the salary of each Congolese employee and 14% of that of an expatriate employee (IERE). This tax is not levied on the salary but charged to the company.
The seed of corruption
Destructive taxation for investors in several sectors. The personal income tax rate is 30% for SMEs, and company employees and managers must also pay an additional 15% of their declared income.
How, then, can the total of all these taxes bring so little to the DRC? It is estimated that taxes do little to contribute to the country's meager GDP. According to the World Bank, the DRC, despite a tax rate of 67%, has a contribution of taxes to the GDP of 7,76%, lower than it was in 2001 - 9%.
For activist Jean-Claude Mputu, from the Le Congo is not for sale collective, “corruption is responsible for all the ills of the country”. But if we look often at the corruption of politicians and the military, any visitor to the country will see that petty corruption is much more widespread.
“Beyond the millions that are pointed out in big business, corruption is present in all the life of the Congo. It is undoubtedly one of the few countries in the world where, within the administration, there is no price list and where everything is negotiated by word of mouth. It suffices to look on the roads at the way in which the agents assigned to road traffic constantly take money from the population, ”summarizes the activist.