Tax laws Libya
Libya's taxation system is governed by various laws and regulations, with the Law Society of Libya playing a pivotal role in digitizing and archiving legal documents to enhance accessibility.
1. Personal Income Tax:
Progressive Tax Rates: Libya applies a progressive tax system to individual incomes, with rates as follows:
- 1% for incomes up to LYD 50 per month.
- 2% for incomes exceeding LYD 50 but not exceeding LYD 100 per month.
- 3% for incomes over LYD 100 per month.
Jehad Tax: An additional Jehad Tax is levied on individuals at rates mirroring the above brackets:
- 1% for incomes up to LYD 50 per month.
- 2% for incomes exceeding LYD 50 but not exceeding LYD 100 per month.
- 3% for incomes over LYD 100 per month.
2. Corporate Income Tax:
Standard Rate: The corporate tax rate stands at 20% of taxable profits.
Jehad Tax: An additional Jehad Tax of 4% is applied to corporate profits.
Combined Corporate Tax: The aggregate corporate tax, including Jehad Tax, totals 24% of taxable profits.
3. Consumption Taxes:
Value Added Tax (VAT): Libya does not impose a VAT.
Excise Taxes: There are no excise taxes in Libya.
Customs Duties: A service fee of 5% is levied on most imports. Customs duties were abolished in 2005, except for tobacco and tobacco products.
4. Recent Legal Developments:
Law No. (7) of 2010 on Income Taxes: This law imposes a 5% tax on taxable income, applicable to both domestic and international earnings of national companies and foreign branches operating in Libya.
Law No. (11) of 2004 Regarding Income Tax: This legislation establishes a progressive tax system with rates ranging from 15% to 40% on net profits, depending on the profit bracket. Additionally, a 4% Jehad Tax is levied on net profits.
Note: Tax laws and regulations are subject to change. For the most current information, it is advisable to consult the Law Society of Libya's digital platform or seek professional tax advice.
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