VAT [Value Added Tax] is an indirect tax on consumption.
This is a percentage increase in the price of every item we buy and every service we receive, this model of tax unification allows for greater transparency and ease of taxation.
How do I calculate VAT?
The amount of tax is levied on the value added at each stage of the process.
For example, suppose a consumer buys a lampshade for $100. With a VAT rate of 17%, $17 would be the tax on the product.
Dividing this value by the steps it takes to get this lampshade to the consumer, we could put it this way:
| Stage | Selling Price | Value Added | VAT (17%) |
| Lamp factory | $50,00 | $50,00 | $8,50 |
| wholesaler | $75,00 | $25,00 | $4,25 |
| retailer | $100,00 | $50,00 | $4,25 |
| VAT Total | $ 17,00 |
VAT rate on goods and services in Africa as of 2021, by country
| Country | Last | Reference |
| Algeria | 19% | Dec/21 |
| Angola | 14% | Dec/21 |
| Benin | 18% | Dec/20 |
| Botswana | 12% | Dec/21 |
| Burkina Faso | 18% | Dec/20 |
| Burundi | 18% | Dec/20 |
| Cameroon | 19.50% | Dec/21 |
| Cape Verde | 15% | Dec/21 |
| Central African Republic | 19% | Dec/20 |
| Chad | 18% | Dec/21 |
| Comoros | 10% | Dec/20 |
| Congo | 16% | Dec/21 |
| Djibouti | 10% | Dec/20 |
| Egypt | 14% | Dec/21 |
| Equatorial Guinea | 15% | Dec/21 |
| Eritrea | 5% | Dec/20 |
| Ethiopia | 15% | Dec/21 |
| Gabon | 18% | Dec/20 |
| Gambia | 15% | Dec/20 |
| Ghana | 13.50% | Dec/21 |
| Guinea | 14% | Dec/21 |
| Ivory Coast | 18% | Dec/21 |
| Kenya | 16% | Dec/21 |
| Lesotho | 15% | Dec/21 |
| Madagascar | 20% | Dec/21 |
| Malawi | 16.50% | Dec/21 |
| Mali | 18% | Dec/20 |
| Mauritania | 16% | Dec/21 |
| Mauritius | 15% | Dec/21 |
| Morocco | 20% | Dec/21 |
| Mozambique | 17% | Dec/21 |
| Namibia | 15% | Dec/21 |
| Niger | 19% | Dec/21 |
| Nigeria | 7.5% | Dec/21 |
| Republic of the Congo | 18.90% | Dec/21 |
| Rwanda | 18% | Dec/21 |
| Senegal | 18% | Dec/21 |
| Seychelles | 15% | Dec/21 |
| Sierra Leone | 15% | Dec/20 |
| Somalia | 10% | Dec/20 |
| South Africa | 15% | Dec/21 |
| Sudan | 17% | Dec/20 |
| Swaziland | 15% | Dec/20 |
| Tanzania | 18% | Dec/21 |
| Togo | 18% | Dec/21 |
| Tunisia | 19% | Dec/21 |
| Uganda | 18% | Dec/21 |
| Zambia | 16% | Dec/21 |
| Zimbabwe | 14.50% | Dec/21 |
The importance of VAT
VAT is important because that increases the revenue of the governments in countries that actually use that system. in addition, with a VAT the amount owed to the government by is paid partially, causing less discomfort to the consumer.
Leave a Reply