Burkina Faso adopted Finance Law No. 021-2025/ALT on December 27, 2025, introducing comprehensive amendments to corporate income tax, VAT, special contributions, customs duties, and tax procedures, with effect from January 1, 2026.

VAT and Indirect Tax Changes

The law establishes a 30% VAT withholding mechanism applicable to VAT due by eligible exporters, large enterprises, and public entities. This withholding system represents a significant shift in VAT collection procedures for major taxpayers and government bodies operating in Burkina Faso.

A research and innovation levy has been introduced on selected imported goods, expanding the country's indirect tax base. The government has renewed targeted tax incentives, including VAT and customs duty exemptions for agricultural cooperatives, e-invoicing systems, and strategic investment projects.

Corporate Tax and Special Contributions

The legislation clarifies the corporate income tax treatment of head office expenses and modifies certain tax bases and filing deadlines. Changes to the special contribution regime include shifting the tax base to profit after tax and adjusting filing and payment deadlines, including provisions for nil declarations.

An exemption from the 5% withholding tax on payments to public entities for authorized services has been introduced, subject to certification by the tax authorities.

Tax Administration and Compliance

The law strengthens tax audit powers and formalizes written and electronic communication procedures during audits and assessments. New penalties have been introduced for failure to respond to information requests from tax authorities. Reporting obligations for non-profit entities have been expanded, and changes have been made to taxpayer classification under simplified tax regimes.

Context

These reforms align with broader West African trends toward digitalized tax administration and enhanced compliance mechanisms. The VAT withholding system particularly reflects regional efforts to improve tax collection efficiency from large taxpayers while the research and innovation levy demonstrates fiscal policy coordination with economic development objectives.

VAT legislation and regulatory updates across Burkina Faso.

Burkina Faso Enacts Finance Law with VAT Withholding and Tax Procedure Reforms

Burkina Faso Enacts Finance Law with VAT Withholding and Tax Procedure Reforms