Employers have several tax responsibilities, including contributing to the Caisse Nationale de Sécurité Sociale (CNSS) for social security coverage of their employees. These contributions fund various benefits like retirement, sickness, maternity, disability, and family allowances. The employer rate is 15% of the employee's gross salary, up to a maximum monthly earnings limit of 15,000 MRU (Mauritanian ouguiya).

Breakdown of CNSS Contributions

Employer contributions to CNSS are broken down into several categories:

• Industrial Health Insurance: 2% (employer contribution)
• Work-Related Injury Insurance: 5% (employer contribution)
• Retirement Plan: 5% (employer contribution)
• Family Allowances: 4% (employer contribution)

Employers also contribute to the Caisse Nationale d'Assurance Maladie (CNAM) to provide health insurance coverage for their employees. The employer rate for this is 5% of the employee's gross salary.

Occupational Medicine Contributions (ONMT)

In addition to CNSS and CNAM, employers contribute to the Office National de la Médecine du Travail (ONMT) for occupational health and safety services. The employer rate for this is 2% of the employee's gross salary.

Important Considerations

Employer contributions are calculated based on the employee's gross salary, including any bonuses, allowances, and benefits in kind. Contributions to CNSS, CNAM, and ONMT must be paid quarterly to the relevant authorities, typically by the 15th of April, July, October, and January.

Employers are also responsible for withholding the progressive income tax (ITS) from their employees' salaries based on a scale.

In Mauritania, employees are required to contribute a percentage of their gross salary towards social security and health insurance. The social security contribution, also known as CNSS, is 1% of the gross salary. This contribution provides various benefits such as retirement, sickness, disability, and family allowances. However, this contribution is capped at a maximum monthly salary limit of 15,000 MRU (Mauritanian ouguiya).

Health Insurance Contributions (CNAM)

Employees also contribute 4% of their gross salary to the national health insurance scheme (CNAM), which provides them with healthcare coverage.

Income Tax (ITS)

Mauritania operates a progressive income tax system known as Impôt sur les Traitements et Salaires (ITS). The rates are as follows:

• 0% up to 6,000 MRU
• 15% for income between 6,001 MRU and 9,000 MRU
• 25% for income between 9,001 MRU and 21,000 MRU
• 40% for income over 21,000 MRU

These tax rates are applied to the employee's taxable income, which is their gross income after certain deductions are made.

Allowable Deductions

Employees can deduct the following expenses from their gross income to calculate their taxable income:

• Fixed Deduction: A standard fixed deduction of 6,000 MRU.
• Social Security and Health Insurance: Employee contributions to CNSS and CNAM.
• Benefits in Kind (capped): Up to 20% of the employee's gross salary. Amounts exceeding 20% are taxable (up to a limit of 40% of their total amount)
• Other Specific Deductions: Certain other deductions might apply under specific conditions.

It's important to note that the employer is responsible for calculating and withholding income tax (ITS) as well as the employee's social security (CNSS) and health insurance (CNAM) contributions. These are then submitted to the relevant authorities.

In Mauritania, the standard VAT rate is 16%. This rate is applicable to most supplies of goods and services within the country.

Imported Services and VAT

Imported services are subject to VAT in Mauritania, typically under a reverse-charge mechanism. This implies that the recipient of the service in Mauritania is responsible for self-assessing and paying the VAT due.

VAT Registration

Businesses providing taxable services in Mauritania must register for VAT if their annual turnover exceeds a threshold of 50,000,000 MRU (Mauritanian ouguiya). However, businesses below this threshold may still choose to register voluntarily for VAT.

Zero-Rated Services

Certain services are zero-rated for VAT purposes, meaning VAT is charged at 0%. These include the export of services, financial services, and certain healthcare and educational services.

Exempt Services

Some services are exempt from VAT. This means that no VAT is charged on those services, and the service provider cannot reclaim any input VAT incurred on expenses related to those services. Examples of these services include the rental of residential property and some basic medical and social services.

VAT Filing and Payment

Businesses registered for VAT must file VAT returns and pay their VAT liability to the Mauritanian tax authorities. The frequency of filing (e.g., monthly or quarterly) depends on the organization's turnover.

Tax incentives can significantly reduce the financial burden on businesses. These incentives can come in various forms, such as reduced corporate income tax (CIT) rates, exemptions on profits, accelerated depreciation, and loss carryforward. Companies in qualifying sectors or those located in special economic zones may enjoy a reduced CIT rate. New businesses may be eligible for a period of profit exemption during their initial years of operation. Businesses might be eligible for faster depreciation deductions on their assets, lowering their taxable income. Companies are permitted to carry forward losses for specific periods to offset future taxable profits.

Sector-Specific Tax Incentives

Mauritania offers several sector-specific incentives to attract investment in priority areas. These sectors include mining, agriculture, fishing, and tourism. In the mining sector, tax holidays, reduced royalties, and customs duty exemptions may be available. The agriculture sector offers exemptions from import duties on agricultural equipment and inputs, as well as reduced tax rates. The fishing sector provides tax benefits, including reduced CIT rates and exemptions from certain import duties and taxes. The tourism sector may grant incentives, such as tax holidays and exemptions on imported construction materials, to businesses.

Investment in Special Economic Zones (SEZs)

Companies operating within designated SEZs in Mauritania typically enjoy a more extensive range of incentives. These incentives include complete corporate income tax exemption, customs duty exemptions, and streamlined administrative procedures. Companies may be fully exempt from CIT for a specified period. Businesses might be exempt from import duties on raw materials, machinery, and equipment. SEZs can offer streamlined business registration and licensing processes.

Tax Incentives for Small and Medium-Sized Enterprises (SMEs)

Mauritania provides tax benefits tailored to SMEs. These benefits include a preferential tax regime with reduced tax rates and exemptions during the initial setup and operational phases. Qualifying SMEs could be subject to a preferential tax regime with reduced tax rates and exemptions during the initial setup and operational phases.