Togo – Work in Progress: VAT Regime for Non-Resident Digital Platforms 

The Togo Government is preparing to take the final step in regulating the digital economy. Following the lead of many other African jurisdictions, the Togo tax authorities have announced their willingness to modernize their tax reporting system, which will be foundational to developing a system specifically designed to capture tax from non-resident digital service providers. 

The principal focus will be on powerhouses of the digital economy. The core push to develop a tax system for digital platforms is to capture tax revenue from GAFAM companies. GAFAM iz acronym for Google, Apple, Facebook, Amazon, and Microsoft. The apps and software in their portfolio should be the largest VAT contributors to state revenue for non-resident digital service providers and e-commerce intermediaries. 

At present, most non-resident digital service providers or e-commerce vendors are outside the scope of the Togo tax authorities. This is primarily because of the poor regulatory framework, which makes VAT registrations primarily a matter of choice, a voluntary approach. 

The Togo’s Government is focused on making a decisive step for introducing a compulsory tax compliance framework for non-resident digital service providers, foreign e-commerce vendors, and closely connected digital intermediaries.