Burkina Faso Introduces VAT on Digital Services Under 2025 Finance Act

March 23, 2025

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As Africa's digital services sector grows, more countries are adopting and implementing VAT rules and regulations for non-resident digital services or digital goods providers. Burkina Faso is another African country to introduce VAT rules on foreign digital providers in 2025.

The decision to implement VAT on non-resident digital services providers, introduce a VAT exemption of locally produced frozen meat, and apply a reduced VAT rate of 10% to national air transport operations was announced by adopting the 2025 Finance Act in February this year, which became effective on January 1, 2025.

Impact on the Foreign Digital Service Providers

The 2025 Finance Act states that the VAT applies to selling goods and services to consumers in Burkina Faso through foreign or local e-commerce platforms, including the fees e-commerce platform operators receive in connection with these transactions.

More specifically, newly adopted rules state that e-commerce platform operators must collect, report, and remit VAT on goods and services sold through e-commerce platforms on behalf of suppliers to the relevant tax authority.

However, the adoption of the 2025 Finance Act and the introduction of VAT for non-resident digital services providers are only the first steps towards fully implementing these rules. In the following months, the competent governing bodies are expected to release guidelines or some other informative material describing how foreign companies subject to these VAT rules must act to be compliant.

Conclusion

By adopting and implementing new VAT rules for the digital economy, Burkina Faso is making a significant step towards establishing a better monitoring system for the e-commerce and digital services sectors.

Moreover, the non-resident digital providers that managed to escape the VAT registration and thus did not charge, collect, and remit VAT on goods sold or services provided will have to adapt to the new regulatory environment and ensure compliance with new VAT rules.

Source: General Directorate of Taxes, ENSafrica

When did Burkina Faso’s VAT on digital services come into effect?

The VAT rules for non-resident digital service providers became effective on January 1, 2025, following the adoption of the 2025 Finance Act in February.

Who is affected by the new VAT rules in Burkina Faso?

Both foreign and local e-commerce platform operators and digital service providers that supply goods or services to consumers in Burkina Faso are subject to VAT.

What is the VAT obligation for e-commerce platforms under the new law?

E-commerce platforms must collect, report, and remit VAT on goods and services sold through their platforms, including fees earned from facilitating transactions.

Are foreign digital providers required to register for VAT in Burkina Faso?

While specific guidelines are still pending, non-resident digital providers are expected to register and comply with VAT obligations under the new law.

Does the 2025 Finance Act include other notable VAT changes?

Yes, it includes a VAT exemption for locally produced frozen meat and a reduced 10% VAT rate for national air transport operations.

Will there be further guidance for digital service providers?

Yes, the government is expected to release additional guidelines to clarify compliance steps for non-resident companies affected by the new VAT rules.

VAT Compliance and Reporting

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