NEW MEASURES INTRODUCED BY LF25:

We wish you an insightful read.

DIRECT TAXES AND RELATED LEVIES

Reforms relating to capital gains and jointly owned real estate assets

The amendments introduced to Articles 80 and 80 ter of the CIDTA now specify that tax on capital gains arising from the transfer of shares, equity interests and similar securities must be paid at the registered office of the relevant company.

In addition, exemptions applicable to capital gains on jointly owned real estate assets are now limited to assets demonstrably indivisible for legal or material reasons.

A new Article 80 quater further requires taxpayers to declare any transfer of real estate assets or securities generating no capital gain within 30 days following the execution of the sale deed.

Revision of the reduced tax rate applicable to capital gains

Article 104 introduced a reduced 5% tax rate for capital gains reinvested before 31 December of the following year.

This reduced rate applies to transfers of securities, shares and equity interests, while the standard rate of 15% remains applicable otherwise.

A reinvestment undertaking must be attached to the tax return, with

a 25% surcharge applying in the event of non-compliance with the reinvestment deadline.

Exemption from provisional instalment payments for new taxpayers

Article 355 introduced an exemption from provisional instalment payments for newly established taxpayers during their first year of activity. This measure aims to simplify tax compliance procedures for newly incorporated businesses and professionals, while easing both their tax and administrative burden.

Single Flat Tax (“IFU”)

Reduction of the tax population subject to the IFU regime

Article 22 of the Finance Law amends and supplements Article 282 ter of the Code of Direct Taxes and Related Levies, extending the scope of application of the Single Flat Tax (IFU) regime. Individuals and professional civil companies carrying out industrial, non-commercial or artisanal activities with annual turnover not exceeding DZD 8 million remain subject to this regime. However, the amended provisions now also cover commercial activities while introducing specific exclusions, including caterers, event venue rental businesses, large-scale retail operators, travel agencies, and other sectors deemed unsuitable for the IFU regime. This reform aims to refocus the IFU regime on small businesses, while excluded sectors will henceforth fall under the real or simplified tax regime.

Mandatory declaration of net income generated

Article 23 of the Finance Law amends Article 282 quater of the CIDTA by requiring taxpayers subject to the IFU regime to declare the net income generated in connection with the turnover of the closed financial year.

This measure seeks to enhance tax transparency and provide the tax authorities with greater visibility over taxpayers’ actual income in order to better assess their contributory capacity, while preserving the specificities of the flat-rate regime.

Reorganisation of deadlines, assessment procedures and claims management under the IFU regime

The reform of the IFU regime introduces several key measures aimed at strengthening tax control mechanisms and streamlining administrative management.

Mandatory annual filing: Taxpayers are now required to submit a detailed annual return before 1 February of each year, including turnover, investment value, number of employees and inventory levels.

Biennial tax assessment: The tax administration will conduct an assessment covering a two-year period and notify the amounts payable. Taxpayers will have 30 days to accept or challenge the assessment.

Adjustment of turnover overruns: Where actual turnover exceeds the previously estimated amount by 20%, a reassessment will be carried out to align taxation with actual business performance.

New taxpayers and quarterly filings: Newly established taxpayers will be required to file quarterly returns after at least three months of activity, with the possibility of opting for different tax regimes.

Corporate Income Tax (“IBS”)

Allowance for R&D expenditure and open innovation programmes

Procedures governing the declaration and payment of capital gains realised by foreign companies

Article 149 bis of the CIDTA, as amended by LF25, clarifies the declaration and payment procedures applicable to capital gains realised by foreign companies without a permanent establishment in Algeria. Payments must now be made to the tax collection office corresponding to the registered office of the company, and declarations relating to capital gains must be filed within 30 days following the transfer, even where no gain arises, in order to strengthen transparency and tax oversight.

Regularisation of excess tax payments and alignment with the Jibayatic system

LF25 amends Article 356 of the CIDTA in order to adapt the procedure for regularising excess tax payments to the requirements of the Jibayatic system. Where excess payments are identified, regularisation may now be carried out either through the submission of a provisional instalment declaration marked “nil” where the excess fully covers the instalment due, or through payment of the difference between the instalment due and the excess identified. This reform enables smoother management of excess payments within the framework of the fiscal year-end settlement process.

Wealth Tax

Article 281 undecies of the CIDTA has been amended to introduce an exception applicable for the year 2025. Wealth tax returns must now be filed no later than 30 June 2025, derogating from the standard timetable which previously required filing every four years before 31 March. This measure is accompanied by a nationwide campaign encouraging affected taxpayers to regularise their tax position, together with warnings regarding penalties applicable in the event of non-compliance with the deadline.

TURNOVER TAXES AND INDIRECT TAXATION

VAT taxable event for real estate developers

Article 59 of LF25 modifies the VAT taxable event applicable to property sales carried out by real estate developers. VAT is now payable upon partial or full collection of the sale price rather than upon delivery of the property. This change enables faster collection by the Public Treasury.

Restructuring of VAT refund procedures

Articles 65 and 66 amend VAT refund procedures by introducing filing deadlines for refund claims and requiring the administration to provide reasons for its decisions. This reform seeks to enhance transparency and efficiency within the system.

VAT registration for newly established businesses

Article 67 specifies that any person carrying out VATable transactions must file a registration declaration within 30 days from the commencement of activity.

VAT exemptions

Article 68 defines VAT exemptions, notably for certain essential and pharmaceutical products, without requiring the submission of an exemption certificate.

Challenges against refund decisions

Article 101 amends the deadlines for contesting VAT refund decisions by specifying that taxpayers have four months from notification to submit a claim.

Measures relating to registration duties and stamp duties

Exemption from registration duties for certain donations

Donations between ascendants, descendants, spouses, and those carried out within the framework of Kafala rights are exempt from registration duties.

Exemption for the State and local authorities

The exemption from registration duties has been extended to the State and to deeds involving local authorities.

Exemption for companies established by investment promoters and innovative projects

Companies established by investment promoters and innovative projects also benefit from exemption from registration duties.

Revision of concession fees applicable to agricultural land

The assessment of land concession fees for agricultural land is now determined according to the remaining duration of the concession.

Liability of notaries and bailiffs

Notaries and bailiffs will henceforth be held liable for the payment of stamp duties in cases of non-compliance with declaration and payment obligations.

Promotion of electronic payments

Stamp duties have been adjusted to encourage electronic payments, with exemptions granted for payments made by bank card, cheque, bank transfer or mobile payment.

Professional card for foreign nationals

A new stamp duty is introduced for foreign nationals changing professional status, together with stricter regulatory measures.

LOCAL TAXES

Property Tax

Increase in the rate applicable to unoccupied secondary properties
The property tax rate applicable to unoccupied secondary properties will increase from 7% to 10% in order to encourage occupation or rental of such properties and contribute to addressing the housing shortage.

Pipeline transportation of hydrocarbons

The basis for calculating the TLS applicable to hydrocarbon transportation is now determined according to the quantity transported multiplied by the applicable tariff.

Exemptions and taxable event

Exemptions applicable to certain pipeline transportation operations no longer apply to Sonatrach-SPA, and the taxable event for TLS purposes is now the transportation itself rather than the collection of payment.

Transfer or cessation of activity

In the event of a transfer or cessation of activity, TLS must be self-assessed within 10 days.

Declaration and payment

The declaration and payment procedures applicable to TLS have been clarified, including a mandatory electronic filing obligation with the services of the Large Taxpayers Directorate.

CUSTOMS MEASURES

Digitalisation of customs formalities

Article 141 of LF25 now allows customs formalities to be completed electronically, thereby simplifying procedures for economic operators and ensuring the legal recognition of electronic formalities.

Reduction of processing timelines

The period during which goods may remain in temporary storage has been reduced from 15 to 8 days. In addition, detailed customs declarations must now be filed within 8 days, thereby facilitating customs clearance procedures.

Advance declaration and amendments

Article 146 introduces the possibility of filing a declaration prior to the arrival of goods, with amendments permitted within six months, thus providing greater flexibility to economic operators.

Free zones

The introduction of free zones into the Customs Code aims to stimulate investment and trade flows. These zones will benefit from tax exemptions and strict customs controls, ensuring operational compliance and security.

MEASURES RELATING TO TOBACCO ACTIVITIES

Increase in the additional IBS rate

The corporate tax rate applicable to tobacco manufacturers has been revised. Manufacturers of snuff and chewing tobacco are now subject to a 20% rate, while manufacturers producing smoking tobacco products, including electronic cigarettes and shisha products, are subject to a 31% rate. Furthermore, the removal of the integration criterion simplifies the calculation of tax for the relevant companies.

Revision of share capital thresholds

The paid-up share capital threshold applicable to tobacco manufacturers has been reduced to DZD 100,000,000 for electronic cigarette and shisha manufacturers in order to promote local investment while simplifying administrative procedures.

Revision of the additional tax

The tax applicable to tobacco products has been increased to DZD 65 per pack, with the objective of financing public projects and increasing tax revenues.

TAX PENALTIES AND TAX AUDITS

Determination of penalties applicable to TATF

Article 17 of LF25 clarifies the penalties applicable for failure to file the special declaration relating to the vocational training and apprenticeship tax (TATF). Penalties vary depending on whether the declaration gives rise to tax due. Where tax is payable, penalties amount to 10% for delays of less than one month, 20% for delays between one and two months, and 25% for delays exceeding two months. Where no tax is due, fines amount to DZD 2,500 (less than one month), DZD 5,000 (between one and two months), and DZD 10,000 (beyond two months). This clarification strengthens deterrence while adapting sanctions to taxpayers’ circumstances.

Deadline for responding to reassessment notifications

Article 88 of LF25 sets a 30-day deadline for responding to reassessment proposal notifications, thereby eliminating a previously existing ambiguity. This expressly stated deadline aligns with that applicable to requests for information and enhances clarity within the tax procedure.

Clarification regarding taxpayers’ rights and obligations

Article 90 of LF25 specifies that taxpayers may respond to reassessment proposals through multiple correspondences within the statutory deadline. It also introduces a mandatory notification requirement by the administration in cases where no reassessment is issued, applicable to both comprehensive and limited tax audits. These provisions reinforce transparency and predictability within tax procedures.

International exchange of tax information

Article 100 introduces a framework governing the exchange of information between the Algerian tax administration and its foreign counterparts. This measure, aligned with international standards, aims to combat tax evasion and improve the efficiency of tax audits, particularly regarding cross-border transactions and transfer pricing.

Integration of fertiliser producers into strategic sectors

Article 200 amends the list of strategic sectors to include fertiliser production, highlighting its importance for agriculture and food sovereignty.

The conditions relating to prior authorisation and the State’s pre-emption rights remain unchanged, thereby ensuring enhanced State oversight.

Promotion of non-cash payment methods

Article 202 imposes the use of traceable payment methods for real estate transactions, vehicle sales, yacht purchases and mandatory insurance policies. This measure seeks to integrate a greater number of transactions into the formal financial system, thereby reducing tax evasion.

Clarification of tax remedies

Article 94 clarifies that taxpayers may directly challenge tax assessments before the administrative courts, irrespective of the intervention of the CCW. This clarification guarantees more direct and transparent access to tax justice.

Guarantee relating to the Legal Stay of Payment

Article 102 harmonises the conditions for obtaining a Legal Stay of Payment (SLP), allowing taxpayers to provide guarantees covering disputed tax assessments as an alternative to partial payment of duties. This measure introduces greater flexibility while securing tax claims.

Regularisation of transfers of equity interests

Article 198 introduces a regularisation mechanism for transfers of equity interests carried out before June 2020 without a waiver certificate relating to the State’s pre-emption right. This mechanism provides a solution for affected companies while excluding strategic sectors and State-owned enterprises.

Each of these measures aims to strengthen transparency, predictability and efficiency within Algeria’s tax framework, while supporting the country’s strategic economic objectives.

Distinction between tax refund claims and excess payments

Article 107 of LF25 amends Article 109 of the CPF by establishing a four-financial-year limitation period for claims relating to the refund of excess payments connected to provisional instalments or Corporate Income Tax (IBS). This measure clarifies the conditions introduced by LF24 by distinguishing claims arising from taxpayer or administrative errors from those relating to overpayments.

Extension of the jurisdiction of appeal commissions for hydrocarbons

Article 103 extends the scope of appeal commissions to taxes, duties and royalties governed by hydrocarbons legislation, thereby strengthening their specialisation and providing a tailored administrative recourse mechanism.

Strengthening the composition of commissions

Article 104 introduces a representative from the Ministry of Energy within the Central Appeals Commission, providing specific expertise in oil and gas taxation matters.

ADMINISTRATIVE AND DIGITAL SIMPLIFICATION

Amendment to the filing deadline for Form G n°01

LF25 proposes postponing the filing deadline for Form G n°01 to 30 June of year N+1 instead of 30 April, enabling taxpayers to integrate amounts already paid as tax credits.

Clarifications regarding the declaration of existence

The commencement of activity of taxpayers must now be determined by the document authorising the exercise of the activity or by the commercial register. The declaration of existence must be filed within 30 days with the competent authority.

Harmonisation of VAT and TLS payment deadlines

Payment of the liquidation balance relating to VAT and TLS will henceforth be standardised for all taxpayers on 20 February, thereby simplifying tax obligations.

MISCELLANEOUS PROVISIONS

• Increase in advertising tax: Increase from 1% to 2% of turnover for communication companies (Articles 114 to 117).
• Bank domiciliation tax: Extension of the tax to royalty agreements involving transfers of funds abroad, with rates of 4% for services and 5% for royalties (Article 120).
• Tax exemptions for sovereign Sukuk: Exemption from income tax, corporate tax, registration duties and land advertising tax (Article 132).
• IRG reduction for activities in the Grand South: Extension for an additional five years of the 50% reduction applicable to income tax and corporate profits tax (Article 121).

Tax reduction for banks and Algérie Poste:

• Tax reduction on commissions generated from electronic transactions until 31 December 2025 (Article 138).
• Extension of tax exemptions for incubators: Additional two-year extension of tax exemptions granted to incubator companies (Article 139).
• Increase in the solidarity contribution: Increase in the rate from 2% to 3%, together with the addition of tariff subheadings applicable to inputs used in tobacco products (Article 173).
• Increase in late payment penalties: Increase in penalties from 1% to 5% for unpaid State-owned products and revenues (Article 167).
• Extension of tax exemptions for incubators: Additional two-year extension of tax exemptions granted to incubator companies (Article 139).
• Extension of tax exemptions for incubators: Additional two-year extension of tax exemptions granted to incubator companies (Article 139).
• Extension of tax exemptions for incubators: Additional two-year extension of tax exemptions granted to incubator companies (Article 139).
• Increase in the solidarity contribution: Increase in the rate from 2% to 3%, together with the addition of tariff subheadings applicable to inputs used in tobacco products (Article 173).
• Increase in late payment penalties: Increase in penalties from 1% to 5% for unpaid State-owned products and revenues (Article 167).
• Exemption from transfer duties for startups: Extension of the transfer duty exemption applicable to real estate acquisitions carried out by startups (Article 39).
• Extension of consumer credit facilities: Banks are now authorised to grant consumer loans for the acquisition of goods and services by households (Article 176).
• Remote voting for shareholders’ meetings of listed companies: Introduction of remote electronic voting for shareholders, with technical modalities to be defined by COSOB (Article 179).
• Revision of registration and approval duties: Introduction of a new tariff structure for pharmaceutical products and medical devices, with reallocation of funds to the ANPP (Article 184).

Please note that this summary does not constitute legal or tax advice under any circumstances. It is intended solely to provide general information.