Angolan parliament authorizes president to issue tax incentives for oil

The National Assembly of Angola has unanimously approved bills that grant the Angolan President the authority to legislate on fiscal incentives for the concession of oil blocks 30, 44, and 45 in the Namibe basin.

These blocks, located in deep and ultra-deep waters, pose operational complexity and high research risk due to geological conditions.

In response to the seismic survey results, the consortiums involved in the blocks have reassessed their complexity and identified the need for additional incentives to facilitate exploration drilling and development in the event of discoveries.

The National Agency of Petroleum, Gas, and Biofuels, in collaboration with the national concessionaire, negotiated new contractual and fiscal terms with the consortiums to ensure the continuity of oil activities and increase state revenues through investment profitability and oil production maximization.

The approved legislation grants the Angolan President the power to alter the fiscal regime for the concessions, including setting the tax rate on oil production at 8%, the tax rate on oil income at 25%, and establishing uniform rates for amortization of expenses incurred during oil operations.

The legislation also provides for deductions of petroleum income in the investment tax premium.

Angola recognizes the significance of hydrocarbons in diversifying its economy and is actively working to mitigate production decline.

The country’s efforts include increasing fuel storage capacity, refining strategy with the construction of new refineries, and implementing petrochemical projects.

Additionally, during the plenary session, the National Assembly approved the draft Code of Labor Procedure Law, which received overwhelming support.

The updated law aims to meet current requirements and strengthen the regulation of the legal-labor system. The legislative process aims to unify and systematize separate laws on this matter.

The approved measures reflect Angola’s commitment to ensuring a favorable environment for oil exploration and production, promoting economic diversification, and enhancing labor regulations in line with present-day needs.

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