Payments made by a non-resident in Mozambique for certain types of interest payments, rents, royalties, dividends, administrative or administrative costs and distributions of fiduciary income are subject to corporation tax (IRPC) up to 20%. However, the tax rate can be reduced by up to 5% under an applicable double taxation treaty. Mozambique has concluded double taxation agreements (DBA) with the following countries: a DBA ensures that a taxable person is not taxed unfairly, both in South Africa and in the country concerned treated in a given DBA. It therefore offers protection against double taxation and lays down various requirements that a taxable person must meet in order to understand where that taxable person is established as a tax resident. Mozambique has concluded agreements for the avoidance of double taxation with Portugal, Italy, Mauritius, the United Arab Emirates, macao Special Administrative Region, South Africa, India, Vietnam and Botswana. Foreign and domestic private investment enjoys a number of benefits, including deductions from the corporate tax base (IRPC) and exemptions from customs duties on imports. The minimum amount of foreign direct investment eligible for the purposes of the above-mentioned benefits corresponds to 2,500,000 Meticais (about 71,500 euros). Tax benefits include: (i) exemption from customs duties and TAX on imports of capital goods of category “K” of the Customs Tariff; (ii) investment tax credit; (iii) acceleration of depreciation and reintegration; (iv) deductions from the tax base for investments in the modernisation and introduction of new technologies; and (v) deductions from the tax base for investments made in the field of vocational training; (vi) exemption or reduction of the IRPC tax rate and (vii) exemption from VAT for the taxation of goods. public-private partnerships (PPPs) concern developments in the public sector or in areas providing public services, with the exception of mineral and petroleum resources; major projects; and trade concessions. The general scheme for the award of PPPs is public tendering and subsidies under public procurement rules. Exceptionally, and subject to prior government authorization, the delegation of PPP companies may take the form of negotiations or direct agreements. Tax credits are available for taxes paid on foreign income to avoid or reduce international double taxation.
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