Angola Should Increase Tax Rate For The Wealthy – Report

Angola Should Increase Tax Rate For The Wealthy – Report

Written by Colin McClelland | From Bloomberg

Angola could increase government revenue and simplify collection by raising rates for the wealthiest earners and limiting the number of income-tax brackets, the Christian Michelsen Institute said.

Africa’s second-largest crude producer raised $1.4 billion last year in personal income taxes, the fourth largest source of non-oil revenue, from $1.2 billion in 2012, the Bergen, Norway-based development research group said June 6, citing government data. The southwest African nation is updating a decades-old tax system to broaden collection, increase revenue and streamline procedures as it recovers from a 27-year civil war that ended in 2002.

“The reform under way should hike percentages on people who make more than most, strip out half the income bands that complicate collection and increase basic exemptions,” Odd-Helge Fjeldstad, an economist at the institute and co-author of the report, said yesterday in an e-mailed response to questions. “This would make the system more fair, progressive, simple and transparent in line with the government’s stated goals.”

While crude taxes account for about 80 percent of state revenue, the member of the Organization of Petroleum Exporting Countries is forecast to increase its non-oil economy by 6.4 percent this year, up from 5.8 percent in 2013, according to the International Monetary Fund.

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