(Business in Cameroon) – In an official note to be referenced by Invest in CameroonThe Directorate General of Taxation (DGI) of the Ministry of Finance (Minfi) announced that the Tax on Remittances by Electronic Means (TTA), established by the Finance Act 2022, generated revenue of 7.3 billion CFA francs between February and May 2022. This result bodes well for exceeding revenue targets for these Tax.
In fact, considering that not a single penny was collected under this tax during January 2022, the envelope collected during the above four months reveals an average revenue mobilization rate of just over CFA 1.8 billion per month. Over the remaining seven months of 2022, the TTA is expected to generate just over CFA 12.77 billion in additional revenue. From this perspective, the state should raise a total of 20.07 billion CFA francs over the course of the year. This already exceeds the government’s target of CHF7 million for the current fiscal year.
But as the point owner Mobile Money points out, considering that the end-of-year and the start of the school and college season (August, September and October) are good times for money transfer activity, it is possible to expect an even greater exceedance of DGI’s initial forecast, over projected revenue from the TTA.
In fact, in addition to bank deposits, many schools and universities in Cameroon allow the payment of tuition fees via mobile payment services of telephone operators. At the end of the year, the boom in purchases during the Christmas and New Year holidays should increase receipts from the TTA. In addition to the gradual allocation of Mobile Money services by economic operators, to the payment of taxes and fees (about 10 billion CFA francs were paid in taxes through this channel in 2021, according to the Ministry of Finance, editor’s note).
As a reminder, the law enters into force on 1Verse In January 2022, the TTA corresponds to 0.2% of the amount of money transfer transactions made by any means or technical support that leaves a trace, in particular by electronic means, mobile phone, telegraph, telex, fax … This tax also applies On all cash withdrawals resulting from transferring funds to financial institutions or mobile phone companies.
The Arms Trade Treaty, which the country of Cameroon considers a new place of revenue, is a concern in some international financial institutions. For example, in a report published in March 2022, the International Monetary Fund (IMF) estimates that “Taxing mobile money could be financially unfair and derail the current low level of financial inclusion.” For this Bretton Woods institution, “The poor and unbanked segments of the population, which often live in rural areas and face higher transaction costs from formal banks, are negatively affected by this measure.”
Moreover, these concerns from the International Monetary Fund do not displease the state of Cameroon, which clearly intends to benefit from the explosion of electronic payments in the country in recent years. In fact, according to data from the Bank of Central African States (Beac), in 2020, Cameroon alone had 19.5 million out of 30.1 million Mobile Money accounts registered in the Cemac region (Cameroon, Congo, Gabon, Chad, Central African Republic and Equatorial Guinea) i.e. 64.8% of the total. This is three times more than the accounts in Congo (7.1 million) and about 10 times more than that of Gabon (2.7 million), during the same year.
” In terms of the number of transactions, payment service providers in Cameroon carry out 73.13% of societal transactions“,” Beck Day report reveals« E-money payment services in Simac in 2020“.
Bryce R. Mbodiam
05-01-2022 – Taxes on remittances: Cameroon plans to raise about 20 billion CFA francs in 2022
11-29-2021 – Tax on money transfer: In Cameroon, taxpayers cry out for double taxation