The IMF has criticized Cameroon for ineffective implementation of its 2013 investment incentives law, advocating for reforms to enhance tax and customs revenues. Business leaders also call for an overhaul, citing misalignment with current government priorities. Significant tax breaks in 2023 raised concerns over revenue loss and economic impact, stressing the need for legislative change.

The International Monetary Fund (IMF) has expressed dissatisfaction with Cameroon’s execution of its 2013 investment incentives law, which provides tax and customs exemptions for 5 to 10 years. In an agreement dated January 30 with the Cameroonian government, the IMF called for revisions to enhance the law’s effectiveness, particularly regarding governance in the extractive sector and overall business climate.

According to the IMF, the investment incentives law has not yielded the expected outcomes since its introduction. The government is under pressure to boost tax and customs revenues to meet financial obligations, necessitating improvements to the 2013 law, which has already seen a revision in 2017.

The IMF’s push for reform is rooted in the 2013 law’s inadequate implementation and its impact on national revenue. Business leaders echo these concerns, highlighting that modifications in government policy since 2013 have outpaced the law, necessitating a comprehensive overhaul. The law’s lengthy tax exemption periods allow companies potential misuse of benefits, creating fiscal imbalances within the economy.

In conclusion, the IMF has urged Cameroon to reform its investment incentives law, which is seen as outdated and ineffective in its current form. Business leaders share this sentiment, emphasizing the need for clearer eligibility criteria and alignment with regional development needs. The significant tax revenue losses underscore the urgency of these recommended changes to ensure equitable economic growth and improved government finances.

Original Source: www.businessincameroon.com