Taxes in Madagascar

The Ministère de l'Économie et des Finances sets the national framework. The Direction Générale des Impôts (DGI) assesses taxes, conducts audits and handles tax disputes. The Trésor, through the Direction Générale du Trésor, collects state revenue. The Direction Générale des Douanes handles import duties and import-related tax advances. A Centre fiscal is usually responsible for the taxpayer's local tax file, while communes and other Collectivités Territoriales Décentralisées administer local taxes and some shared revenues. The main legal references are the Code des Impôts 2025, the Code des Procédures Fiscales 2025 and the Loi de Finances 2025. The DGI portal records the complete 2025 codes; the text of the 2026 finance law should be checked separately when a current rate or deadline matters. A NIF, or numéro d'identification fiscale, is a unique and permanent tax identification number. Individuals, companies and permanent establishments with taxable activities, assets or income generally register for a NIF and receive a carte fiscale. A company should register before beginning its activity. e-Hetra can provide NIF registration, electronic declarations, electronic payments, tax-status information and tax documents, although the required channel depends on the Centre fiscal, the Direction des Grandes Entreprises, the Service Régional des Entreprises and current DGI instructions. Address changes, existence notices and closure notices also have to be reported within the applicable period. Income tax applies to income earned in Madagascar by individuals and companies, including entities without a permanent establishment where the relevant income is taxable under Malagasy rules. The standard rate is 20%. A minimum assessment generally combines a fixed amount with 1% of annual turnover excluding TVA: Ar500,000 plus 1% for agriculture, handicrafts, industry, mining, hotels and tourism, and Ar1,000,000 plus 1% for other activities. Retail fuel businesses use a minimum of two per thousand of turnover. Advance payments normally refer to the preceding year's tax. Registered importers may also face a 2% income-tax advance calculated on the customs value, known as CAF, under the applicable DGI rule. The Impôt Synthétique, or IS, is a simplified tax and is not a company tax merely because its name contains the word impôt. It commonly applies to independent individuals, companies and sole businesses with annual turnover, gross receipts or profit below Ar200,000,000, subject to special rules for agriculture, forestry and intermediaries. The base can be turnover, gross receipts or profit. The rate is 5%, with a payment floor of 3% of turnover. Certain documented expenses, social or health expenditure and donations can produce a 2% reduction under the applicable rules, and some activities have regulatory minimum amounts. The taxpayer calculates the amount and files and pays it by 31 March of the following year. Recensement is due by 15 December, and changes or cessation of activity must be reported within 20 days. Turnover above Ar400,000,000 generally triggers a move to the régime du réel from the following year, with the change made before the annual closing; a business can also choose the régime du réel at formation. Salary income is generally subject to the Impôt sur les Revenus Salariaux et Assimilés (IRSA), a withholding tax deducted by the employer or other paying party whenever salary is paid. The standard scale is 0% up to Ar350,000, 5% from Ar350,001 to Ar400,000, 10% from Ar400,001 to Ar500,000, 15% from Ar500,001 to Ar600,000 and 20% above Ar600,000. A minimum tax of Ar2,000 applies, and the taxable amount is rounded down to the nearest Ar100. The withheld amount is generally paid within 15 days of the following month, with special cases using a semi-annual or bi-monthly schedule. Benefits in kind are valued under specific rules, including 15% of actual monthly vehicle costs, housing at 50% of actual rent or value subject to a ceiling of 25% of fixed cash pay, and telephone use at 15% of the employer's cost. An overseas employer may require the employee or a representative in Madagascar to handle payment. The Taxe sur la Valeur Ajoutée (TVA) covers taxable supplies in Madagascar and imports across sectors such as trade, industry, agriculture, handicrafts, mining, hotels, gaming, services and liberal professions. Registration is generally required when turnover excluding TVA reaches Ar400,000,000, or when a business using the régime du réel opts for TVA. A non-resident service provider can be subject to TVA for an intermittent service independently of turnover or the customer's status. The standard rate is 20%; exports of goods and services are taxed at 0%, while bottled butane gas is subject to 10%. Import TVA is processed through customs, and domestic TVA is handled by the DGI. A TVA return and payment are generally due by the 15th of the following month, including a return with no amount payable. Input TVA is recoverable only for taxable transactions when invoices meet the requirements and payment can be supported through a bank or mobile-banking record. In 2025, TVA also applied to bank-loan interest for credit institutions, with the stated exception of microfinance institutions. Businesses have duties beyond calculating tax. They need a NIF and carte fiscale, maintain accounting records, issue invoices and retain supporting documents. A beneficial-owner register and transfer-pricing documentation may be required for qualifying related-party or privileged transactions. Electronic documentation can be prepared in Malagasy or French. A 2025 decree operationalized electronic invoicing. Late or missing declarations can result in penalties based on turnover, including Ar20,000, Ar50,000, Ar100,000 or Ar200,000 depending on the applicable category. Transfer-pricing and beneficial-owner violations can add a penalty of up to Ar10,000,000. Failure to withhold or pay IRSA can lead to penalties of 40% or 80% of the withheld amount, and TVA violations can attract 10%, 40% or 80% penalties depending on the conduct. Import taxes are settled before goods are released. The DGD handles the customs process and import-related IR or IS advances, while the DGI handles domestic tax obligations. Other national taxes include IRCM on income from movable capital, IPVI on certain capital gains, IFT on land, IFPB on built property, DE on registration, DA on stamp-related charges, IMP on property-related transactions and TVM on motor vehicles. Their exact application depends on the transaction, asset, document or taxpayer status, so a general income-tax calculation does not replace the relevant tax check. The DGI may examine a return, issue an additional assessment and apply late-payment penalties. A taxpayer can request a remission or instalment arrangement, but neither relief is automatic. For state taxes, a prior administrative complaint goes to the authority responsible for tax litigation. The DGI generally decides within 60 days. The undisputed amount remains payable unless a valid suspension arrangement applies. Further proceedings may go to the Conseil d'État or the Cour suprême for state taxes. Disputes about local taxes follow the commune's assessment service and the Centre fiscal, with the Tribunal administratif handling judicial proceedings. Madagascar can tax income sourced in the country even when the foreign business has no permanent establishment. A permanent establishment may include a fixed place of business, a building site or installation lasting more than 120 days, or a service project lasting more than 90 days within one year. A tax treaty and Malagasy domestic law need to be checked together; no single treaty rate applies to every partner country or income type. Madagascar and Morocco have had a bilateral convention since 2023. Madagascar ratified the Multilateral Convention on Mutual Administrative Assistance in Tax Matters on 28 July 2025, with effect from 1 January 2026. The framework supports exchange on request, spontaneous and automatic exchange, joint audits, assistance with collection and service of documents abroad. Transfer pricing follows the arm's-length principle, and the taxpayer carries the documentation burden when the DGI alleges a deviation.