Specific Taxes in Cabo Verde
Beyond corporate and personal income taxes, Cabo Verde levies a range of specific taxes that contribute to its fiscal landscape. These taxes encompass various aspects of economic activity and individual obligations, providing a comprehensive tax system that supports government revenue and policy objectives.
Value-Added Tax (VAT)
VAT is a consumption tax imposed on the sale of goods and services within Cabo Verde. It is a comprehensive tax that applies to most business transactions, with a standard rate of 15%. Certain essential goods and services, such as food and healthcare, are exempt from VAT, while others may be subject to reduced rates.
Property Tax
Property tax is an annual levy on real estate owned by individuals or entities in Cabo Verde. The tax is based on the property's value, which is determined by its location, size, and amenities. Property tax revenues are primarily used to fund local government services and infrastructure development.
Environmental Taxes
Cabo Verde has implemented environmental taxes to discourage harmful practices and promote sustainable development. These taxes target activities that impact the environment, such as emissions, waste disposal, and the use of natural resources. The revenues generated from environmental taxes are often allocated to environmental protection measures and conservation efforts.
Stamp Duty
Stamp duty is a tax levied on various legal documents and transactions in Cabo Verde. It applies to property transfers, share transfers, and certain contracts. The rate of stamp duty varies depending on the type of document or transaction.
Capital Gains Tax
Capital gains tax is imposed on profits realized from the sale of capital assets, such as real estate, stocks, and securities. The tax rate is typically a percentage of the capital gain, and it may vary depending on the asset type and holding period.
Customs Duties
Customs duties are taxes levied on imports and exports of goods in Cabo Verde. These duties are typically based on the value or quantity of the goods being traded. Customs duties serve to generate revenue for the government and protect domestic industries by regulating international trade.
Taxpayers Subject to Specific Taxes
The specific taxes in Cabo Verde apply to various categories of taxpayers, including:
- VAT: Businesses engaged in the supply of goods and services, with certain exemptions for specific transactions.
- Property Tax: Property owners, including individuals, companies, and trusts.
- Environmental Taxes: Companies and individuals engaged in activities with environmental impacts, such as manufacturing, waste disposal, and energy production.
- Stamp Duty: Parties involved in transactions subject to stamp duty, such as property buyers, shareholders, and parties to contracts.
- Capital Gains Tax: Individuals or entities realizing gains from the sale of capital assets.
- Customs Duties: Importers and exporters engaged in international trade.
Purpose and Rationale
The specific taxes in Cabo Verde serve diverse purposes, including:
- VAT: VAT generates revenue for government expenditure and public services. It also promotes economic growth and fiscal stability.
- Property Tax: Property tax contributes to local government budgets and infrastructure development. It also helps regulate property ownership and discourage speculative investment.
- Environmental Taxes: Environmental taxes aim to internalize the costs of environmental damage and encourage sustainable practices. Revenue may be used for environmental protection measures and conservation efforts.
- Stamp Duty: Stamp duty revenue contributes to government revenue and may be allocated to various public services and initiatives.
- Capital Gains Tax: Capital gains tax helps ensure fairness in the tax system by taxing gains from asset appreciation. Revenue may be used for general government expenditure.
- Customs Duties: Customs duties generate revenue for the government and protect domestic industries by regulating international trade.
Legal Framework
The specific taxes in Cabo Verde are established and regulated by various legal statutes, including:
- VAT: Código do Imposto sobre o Valor Acrescentado (CIVA)
- Property Tax: Código do Imposto Predial Urbano (CIPU)
- Environmental Taxes: Código do Imposto sobre o Ambiente (CIA)
- Stamp Duty: Código do Imposto do Selo (CIS)
- Capital Gains Tax: Código do Imposto sobre as Mais-Valias (CIMV)
- Customs Duties: Código Aduaneiro de Cabo Verde (CACV)
These legal texts outline the obligations, rates, and procedures for the collection and enforcement of specific taxes in Cabo Verde.
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