Cameroon: Fiscal Measures To Contain Damage from Covid-19
Fiscal policies can be used to save lives in times of pandemics like the Covid-19 the world is battling to contain. According to IMF, “countries have taken fiscal actions amounting to about $8 trillion to contain the pandemic and its damage to the economy”.
The Prime Minister of Cameroon, Joseph Dion Ngute on April 30, 2020, in a special statement outlined some fiscal measures to help contain further damage to the economy by the Covid-19.
Download Special Covid-19 Statement:
The first on his list was uplifting the ban on bars, restaurants and leisure facilities to operate after 6pm. It should be noted that in his first public statement to curb the spread of Covid-19, the PM, on instructions from the Head of State, Paul Biya, placed an order for bars to shut down at 6pm.
Fiscal measures to contain Covid-19 damage
According to the International Monetary Fund, these fiscal measures should follow the three guiding principles:
Deploy resources in a temporary and efficient manner
Assess, monitor and disclose fiscal risks
The following are some of the measures that have been put in place by the government of Cameroon to save lives and reduce the economic damage caused by the Coronavirus:
Statistics & Tax Returns – The deadline for filing in the Statistics and Tax Returns has been postponed. Taxpayers will not pay penalties for late payment. The official deadline for filing the STR is before March 15 for the previous fiscal year.
Tax Recovery – Forced tax recovery methods have been suspended; payment deferrals and moratorium have been granted to businesses directly affected by the pandemic.
Property Tax – The deadline for the payment of property (land) tax has been pushed to September 30, 2020. The official deadline for the payment of the land tax is June 30 yearly. The tax is due on January 1 each fiscal year.
Covid-19 Donations & Gifts – Donations and gifts offered by companies to help fight the Covid-19 pandemic will be fully deducted when determining the corporate tax. The General Tax Code provides that donations or gifts given during disasters shall be deducted in the form and conditions determined by the Minister of Finance. Download the General Tax Code: English – 2019 Version | French – 2020 Version However, sums granted to the fight against HIV/AIDS that are justified are fully deductible. Same happens to sums given to research and development organizations that are located in Cameroon and carry out health, agriculture and animal husbandry activities.
Tourist Tax – Exemption from Tourist Tax which is based on overnight stays in any accommodation facility. Read more about the tourist tax in Cameroon.
Buyam-sellam – Petty traders have been exempted from council tax and withholding tax (discharge tax) for the second quarter. Taxi cabs and motorbikes have also been exempted from the discharge and axle tax for the second quarter.
Port Fees & Penalties – At the level of the port, a temporary suspension from parking and demurrage fees at the Douala and Kribi seaports for a period of three months.
Value-added Tax Credits – In one of its recommendations, the IMF called on countries to fully and pay on time VAT refunds. In the PM’s statement, a “special envelop” of XAF25 billion has been put in place to clear VAT credits that have been waiting to be reimbursed. This refunds will help businesses have the needed cash to run activities.
Due to Covid-19, countries will see their fiscal deficits and debt ratios increase. There will be an increase in spending, meanwhile revenues will fall. In this regard, countries like Cameroon with limited health capacity will need aid and medical resources to help in the fight against the spread of the virus. The Managing Director of IMF, in a speech said, the organization has a lending capacity of $1 trillion to assist low-income developing countries and other member states.
This content has been prepared for information purposes only. It is not intended to provide, and should not be relied on for, tax, accounting or legal advice. You need to consult your own tax, accounting or legal advisors before engaging in any transaction.
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