Africa-Press – Mozambique. Frelimo approved in the Mozambican parliament the fiscal package urgently submitted by the Head of State, following the walkout of the three opposition benches from the plenary, who demanded a postponement of the debate to better study the legislation.
The package involves amendments approved in the Council of Ministers and submitted urgently to parliament by the President, relating to the Specific Consumption Tax (ICE), Simplified Tax for Small Taxpayers (ISPC), Value Added Tax (VAT) code, Personal Income Tax (IRPS) code and Corporate Income Tax (IRPC) code.
In its justification, the Presidency explained that the objective is to “modernise the tax regime by aligning it with the current digital and financial economy, to achieve greater tax justice and equity, expand the tax base and reinforce transparency and trust in the tax system”.
All these laws were approved in general and specific terms only with the votes of the parliamentary bench of the Mozambique Liberation Front (Frelimo, the parliamentary majority), after the three opposition benches – the Mozambican Democratic Movement (MDM), Mozambican National Resistance (Renamo) and Optimistic People for the Development of Mozambique (Podemos) – rejected the debate, requesting more time to analyse the proposals.
Earlier, when justifying these documents, particularly the VAT and customs tariff, the Finance Minister, Carla Loveira, said that the legislative package aims to broaden the tax base to improve the State’s tax revenues, easing pressure on the Budget, denying that the laws would increase taxes.
“Companies with multiple branches conduct internal operations that are difficult to monitor, creating the risk of transfer pricing manipulation, so there is a need to introduce control mechanisms for companies with multiple establishments or branches, consolidation and detailed reporting of internal or branch transactions, to avoid transfer pricing manipulation and ensure correct taxation of transactions,” the Minister said, referring to VAT.
Explaining the customs tariff, she said it aims to establish customs duties, fees and rules applicable to goods entering and leaving the country, including establishing the schedule for tariff dismantling as foreseen in agreements with countries in the southern Africa region and member states of the European Union.
After the opposition abandoned the plenary, refusing to debate the fiscal package because they consider it “a betrayal of the will of the people” and accusing the ruling party of attempting to return to a one-party system, Frelimo also denied using the “dictatorship of the vote” to push forward debates and approve legal instruments in parliament.
“I think the arguments we have already presented are sufficient: Frelimo has conceded, we would never use the dictatorship of the vote, let that be clear, but we also cannot hinder the functioning of the State,” said the head of the ruling party’s parliamentary bench since 1975, Feliz Sílvia, at a press conference in Maputo.
