Enactment of the Law no. 17/2017, of 28 December, which approved the Excise Tax Code

It was published on the 28 December 2018, the Law no. 17/2017 of 28 December, which amended the Excise Tax Regime in Mozambique, approved by Law no. 17/2009, of 10 September and their successive amendments.

The excise tax concerns certain types of goods produced in national territory or imported, in accordance with the chart enclosed to the mentioned law, providing four specific tax schemes:

1. Alcohol taxation scheme;

2. Alcoholic beer, wines and other types of alcoholic beverages taxation scheme;

3. Manufactured tobacco and substitutes taxation scheme;

4. Automobile vehicles taxation scheme.

These products are subject to the Excise Tax under the terms of the relevant framework, from the moment of their production in national territory or their import. For such effects, shall be deemed as an import of goods, their entrance in national territory or, in case they are under a suspension of tax scheme, the moment its application ends and enter domestic consumption.

In turn, are not subject to Excise Tax in national territory any alcoholic beverages, manufactured tobacco and perfumes, when imported by natural persons, in their hand luggage and provided the relevant limits are observed.

The Excise Tax shall only be chargeable from the moment of release of the goods in the consumption circuit, such as:

1. The manufactured product is released from the production unit in normal commercialization conditions, in accordance to the standard practice regarding the relevant or identic products;

2. In case of import, in accordance to the customs rules;

3. The finished product is released from the customs warehouse.

Another feature of this new regime regards the mandatory requirement of application of a legal seal of control to Mozambican produced products as well as to imported alcoholic beverages and manufactured tobacco.

Furthermore, the Mozambican legislator, defined as relevant the applicable rates underlined in the attached chart to the diploma, which, similarly to the revoked one, are deemed as ad valorem or specific, being applicable the one´s which result in a greater tax amount.

Regarding the applicable rates, shall be applicable the ones in force at the moment when the tax becomes chargeable – against the provided in the revoked diploma, it is established a minimum tax amount for each taxation unit, being the rate progressive for 2018, 2019 and 2020.

The Law no. 17/2017 of 28 December entered into force on the 1 January 2018.