UNDP-South Centre Capacity Building Workshop for Angola on Taxation of the Digitalized Economy

By the United Nations Development Programme (UNDP) and South Centre

5 de September de 2024

um grupo de pessoas posando para uma foto — PNUD Angola

The UNDP through its Tax for SDGs Initiative, and the South Centre jointly organized a three-day capacity building workshop on the taxation of the digitalized economy from 12 to 14 August 2024 in Luanda, Angola. About 25 government officials from the AGT and the Ministry of Finance of Angola participated in the workshop.

Mr. Denis Mingiedi, Regional Director of AGT, 3^rd Region delivered the opening remarks for the workshop. He expressed his appreciation to UNDP and South Centre for organizing such an important training for the benefit of AGT.

um homem e uma mulher em pé em uma sala — Mr. Denis Mingiedi, Regional Director of AGT, 3rd Region delivering opening remarks

PNUD Angola

The UNDP “Tax for SDGs Initiative” in collaboration with the South Centre Tax Initiative aims to support developing countries in increasing Domestic Resource Mobilization (DRM) and achieving Sustainable Development Goals (SDGs). The workshop addressed various approaches available to Angola for taxing revenues derived from the digitalized economy in light of the recent provisions introduced into the United Nations Model Tax Convention by the United Nations Tax Committee and guidance and model rules developed by the OECD. More specifically, the objectives of the workshop were:

•    Capacity building on the design of domestic options for taxing digital services such as Digital Service Tax (DSTs) and Significant Economic Presence (SEP) with a focus on the path taken by other jurisdictions
•    Training on United Nations tax treaty-based solutions for taxing computer software as well as income from automatic digital services
•    Capacity building on the design features of the OECD Two Pillar Solution; including Amount A, Amount B, the Global Anti-Base Erosion (GLoBE) rules as well as the Subject to Tax Rule (STTR)
•    Training on options for developing countries to respond to the OECD Global Minimum Tax (GLoBE rules)

um grupo de pessoas em pé em uma sala — Elisangela Rita, Member, UN Tax Committee

um grupo de pessoas em uma sala — Kolawole Omole, Research Consultant – Tax, South Centre Tax Initiative, South Centre

The workshop’s agenda extended beyond theoretical knowledge, involving extensive breakout group exercises where participants applied policy options to real-world case studies. The trainers were experts from the South Centre as well as a member of the United Nations Tax Committee, Elisangela Rita of Angola.

By discussing real world examples pertaining to the taxation of computer software and income from automated digital services, STTR, and other aspects, participants gained insights into the formulation of robust tax policies that are mutually beneficial for all parties involved with a focus on fairness, prevention of double non-taxation and double taxation.

The workshop featured break-out sessions, allowing participants to brain-storm and exchange views on all the topics covered in the training, and jointly answer exercises on the practical application of the policy options to real world situations. Participants were also trained on the computation of potential revenue gains from Amount A and DSTs with particular focus on the implication of Marketing and Distribution Safe Harbor (MDSH).

um grupo de pessoas sentadas em uma mesa

um, grupo, de, pessoas, sentando, em, um, mesa, com, um, computador, em, um, escritório

Considering the adoption of the Global Minimum Tax by some jurisdictions, participants were exposed to different options to how Angola could respond, including introducing alternative minimum taxes to ensure there would no top-up tax and how tax incentives can be effectively designed as a policy instrument for attracting and retaining foreign direct investments in the light of the GLOBE Rules.

In view of fast-changing business models of companies and the efforts aimed at reforming international tax architecture by the United Nations and the OECD, participants have a better understanding of the current international tax policy issues as well as proposals aimed at addressing them, and are more empowered to decide on beneficial policy options that are consistent with Angola’s economic structure and realities.

um, homem, e, mulher, posar, para, um, foto — Mrs. Faustina Marisa Cardoso Neto, Head of International Cooperation Department of the Angola Revenue Administration, receiving books presented to AGT by the South Centre

On behalf of the South Centre, Mr. Abdul Muheet Chowdhary- Senior Programme Officer, South Centre Tax Initiative, presented to AGT copies of a book titled “International Tax Cooperation: Perspectives from the Global South” to Mrs. Faustina Marisa Cardoso Neto - Head of International Cooperation Department of the Angola Revenue Administration.

The workshop concluded with closing remarks by Mr. Tiago Santos, Member of the Board of Administrators of AGT who thanked UNDP and South Centre’s for the workshop. He urged participants to explore further all the topics covered in the workshop and apply the training to their daily activities.
The positive impact made by the workshop was immediately evident from the pre-workshop and post-workshop feedback provided by the participants, as summarized below:

Going forward, the UNDP and the South Centre will continue to provide support to the Angola Tax Administration on various international tax issues, as well as capacity building on transfer pricing. Through these continued interventions under the Tax for SDGs initiative, the UNDP and the South Centre will continue to support developing countries in mobilizing taxes to achieve the Sustainable Development Goals.