Algeria Introduces VAT Relief For Mining Investment

by Lorys Charalambous, Tax-News.com, Cyprus

30 April 2014

The Algerian Government has introduced value-added tax (VAT) relief for investors in the nation's mining industry, through publication of the new mining law in the country's official bulletin (JORA number 18).

The revised legislation modifies the existing mining law from 2001. Article 137 exempts from VAT equipment, materials, and products used directly for mining exploration activities, as well as services provided by or on behalf of mining permit holders, including studies and rental services. The provisions also exempt from customs duties and fees imported equipment, materials, and products used specifically for exploratory activities.

However, Article 132 of the new law provides for an annual surface tax to be imposed on mining exploration and exploitation permit holders. The charge is in addition to any rent payable to land owners. The payment of the tax becomes due when the mining permit is either issued or renewed, and is calculated on a pro rata basis depending on the number of full months remaining in the civil calendar year. For following years, the tax becomes due at the beginning of each civil year.

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