Angola Plans Customs Levy Changes to Protect Local Industries

Angola, Africa’s second-largest crude oil producer, plans to increase customs tariffs to protect local business while eliminating duties on supplies for industry.

The new code, which may be implemented in the next six months, will raise import taxes on items such as beer, water, soft drinks, agricultural products and livestock to 50 percent from as high as 30 percent, senior customs officials said in an interview in Luanda, the capital. Nigeria, the continent’s largest oil producer, collected $4.7 billion in 2011 customs revenue compared with Angola’s $3.4 billion that year.

“We need to protect national production,” Garcia Afonso, head of the Tariffs and Trade Department at Angola’s National Customs Service, said May 6. “We’ve identified some goods for protection while there will be tax exemptions for raw materials used in industrial production.”

The measures come as the southwest African country modernizes tax collection and customs to cut costs and meet norms set by the World Customs Organization. The new tariffs program may help the government’s goal to diversify the economy, which relies on oil exports for about 40 percent of output and 70 percent of government income.

Goods can generally be moved through customs within 48 hours after steps were consolidated and moved into an electronic format a decade ago, followed by scanners in 2007 and the licensing of import-exporters by the Trade Ministry in 2010.

Implemention of a program to help importers classify merchandise and determine how they should pay is under way, said Nicholas Neto, head of the Policy and Procedures Department.

Petroleum Exemptions

The raw-materials exemptions won’t necessarily apply to the oil and gas industry, which has its own arrangement with the country’s Service for Migration and Foreigners and contracts with the state, Neto said.

Discussions are under way at state petroleum company Sonangol EP, the Ministry of Petroleum and among industry officials about whether to reduce the number of exemptions and trim the current 90 days that oil companies are allowed to finish a customs declaration, he said.

The customs service is focusing less on revenue collection and more on border control, he said.

“Last year we began a canine sniffer program for drugs, money and weapons with 27 dogs,” Neto said. “We opened labs in January to test merchandise such as meat and fish.”

Authorities are looking to model improvements on practices in the U.S. and countries within the Southern Africa Development Community and the Community of Portuguese Language Countries, said Osvaldo Michinge, head of the Customs Legal Office.

The total workforce may increase from 1,700 to 2,250 as the service increases staff at border posts to process more cargo, Michinge said.

To contact the reporter on this story: Colin McClelland in Luanda at cmcclelland1@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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