June 14th, 2022 at 02:12 pm
TOP 5 AFRICAN COUNTRIES WITH THE HIGHEST CORPORATE TAX RATES
Corporate tax refers to the tax that is imposed on the profit made by corporate organizations. These taxes are normally paid on the taxable income of the organization and they include selling and marketing, research and development, depreciation, and cost of goods sold.
The corporate tax rate of every country varies, this is because some countries provide safety for the companies in the country. While others are high, some are low. Corporate taxes are normally influenced by the development and economic status of a country.
Countries that are endowed with a lot of natural resources for instance often generate most of their tax revenue from corporations that deal in oil and natural gas. This allows other industries to function in a relatively low-tax environment.
IMPORTANCE OF CORPORATE TAX PLANNING
- It helps meet the required obligations to the government in a timely manner.
- Also, it minimizes the current tax liabilities by avoiding legally triggering tax costs.
- Again, it helps in planning strategically for future tax liabilities
- Lastly, it prevents you from paying an additional individual income tax.
AFRICAN COUNTRIES THAT PAY A HIGH CORPORATE TAX
Here are some countries that have organizations playing an integral part in the growth of the economy.
1 . Firstly, NIGERIA
The corporate tax rate in Nigeria measures 30%. Although the country has been affected by a high inflation rate in recent times past, the corporate tax remains high.
2 . Secondly, SOUTH AFRICA
Over the past decades, the corporate tax rate has constantly been at 28%. A South African resident company is expected to pay a corporate tax on their worldwide income.
3 . Thirdly, KENYA
The corporate tax in Kenya stands at 30%. In Kenya, companies that are non-resident are subject to Kenya corporate income tax (CIT) only on the trading profits attributable to a Kenyan PE. Foreign companies that have branches in Kenya are subject to a tax rate of 37.5%
4 . Also, ETHIOPIA
The corporate tax in Ethiopia is 30%
5 . Lastly, GHANA
The corporate income tax for most organizations in Ghana has constantly remained at 25% in the past decades. However, companies that are engaged in mining and in the oil sector are subjected to a rate of 35% and those in the hospitality sector pay a rate of 22%.
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