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EY +216 31-342-111
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Fax: +216 (70) 749-045 Avenue Fadhel Ben Achour Centre Urbain Nord 1003 Tunis Tunisia
Principal Tax Contacts
Faez Choyakh +216 31-342-111
Mobile: +216 (98) 419-460 Email: faez.choyakh@tn.ey.com
Omar Rekik +216 31-342-111
Mobile: +216 (29) 669-366 Email: omar.rekik@tn.ey.com
Tax Policy and Controversy
Faez Choyakh +216 31-342-111
Mobile: +216 (98) 419-460 Email: faez.choyakh@tn.ey.com
Omar Rekik +216 31-342-111
Mobile: +216 (29) 669-366 Email: omar.rekik@tn.ey.com
A. At a glance
Corporate Income Tax Rate (%) 15 (a)
Capital Gains Tax Rate (%) 15 (a) Branch Tax Rate (%) 15 (a)
Withholding Tax (%)
Dividends 10 (b)
Interest 20 (b)(c)(d)
Royalties 15 (b)(e)
Gross Rents 5/15 (b)(f)
Management Fees 0/0.5/1.5/3/15 (b)(f)(g)
Branch Remittance Tax 10 (b)(h)
Net Operating Losses (Years)
Carryforward
(a) This is the standard rate of corporate income tax. Profits resulting from the provision of services mentioned in Section 130.1 of the Hydrocarbons Code and the provision of hydrocarbon transport services to companies operating within the framework of the related legislation, as well as banks, financial institutions (for example, insurance companies, including mutual insurance companies), telecommunication companies, car dealers, large commercial enterprises (rules applicable starting from 1 January 2020 to be reported in 2021 and future years) and franchisees of foreign brands and marks, are subject to corporate income tax at a rate of 35%. Handicraft, agricultural and fishing companies are subject to corporate income tax at a rate of 10%. Service companies in the hydrocarbons sector as well as sales and provision of services whose use is intended for abroad are subject to corporate income tax at a rate of 15%. These measures apply to profits made from 1 January 2021, which will be declared during 2022 and subsequent years. Only com panies subject to corporate income tax at a rate of 35% can benefit from the reduction of their corporate income tax rate to 20% for five years when their ordinary shares are admitted to listing on the Tunis Stock Exchange, provided that the rate of openness of capital to the public is at least equal to 30%, or
on the alternative market, provided that the opening percentage of capital to informed investors is at least equal to 30%.
(b) Payments to beneficiaries resident in low-tax jurisdictions are subject to a 25% rate.
(c) This tax applies to payments to residents and nonresidents.
(d) The rate is 10% for interest paid on loans made by nonresident banks.
(e) This tax applies to payments to nonresidents. For further details, see Section B. (f) The applicable rate depends on the nature of the beneficiary and service.
(g) Management fees paid to residents are subject to withholding tax at a rate of 0% if the amount does not exceed TND1,000 and if they do not represent fees. Management fees that do not represent fees in return for intellectual services and that are paid to residents are subject to withholding tax at the following rates:
• 0.5% if the profits of the payment recipient are subject to corporate income tax at a rate of 10%
• 1% if the profits of the payment recipient are subject to corporate income tax at a rate of 15%
• 1.5% if the profits of the payment recipient are subject to corporate income tax at the rate of 35%
If management fees paid to residents are related to fees in return of intellec tual services, they are subject to withholding tax at a rate of 3%. Management fees paid to nonresidents are subject to withholding tax at a rate of 15%, subject to the provisions in double tax treaties.
(h) See Section B.
B. Taxes on corporate income and gains
Corporate income tax. Companies are subject to tax on profits derived from establishments located in Tunisia and on profits that are deemed to be derived in Tunisia under double tax treaties.
Tunisian-source income that is not realized within the framework of a Tunisian establishment, such as royalties, is subject only to final withholding taxes (see Royalties).
Tax rates. The new standard rate of corporate income tax that applies to income realized on or after 1 January 2021 is 15%.
Profits resulting from the provision of services mentioned in Section 130.1 of the Hydrocarbons Code and the provision of hydrocarbon transport services to companies operating within the framework of the related legislation, as well as banks, finan cial institutions (for example, insurance companies, including mutual insurance companies), telecommunication companies, car dealers, large commercial enterprises (rules applicable start ing from 1 January 2020 to be reported in 2021 and following years), and franchisees of foreign brands and marks (for which the integration level is equal to or greater than 30%), are subject to corporate income tax at a rate of 35%.
The tax advantage relating to the reduction of corporate income tax for companies introduced to the Tunis Stock Exchange that are not subject to corporate income tax at a rate of 35% was removed by the 2021 Finance Act. Only companies subject to corporate income tax at a rate of 35% can benefit from the reduction of their corporate income tax rate to 20% for five years when their ordinary shares are admitted to listing on the Tunis Stock Exchange, provided that the rate of openness of capital to the public is at least equal to 30%, or on the alternative market, pro vided that the opening percentage of capital to informed inves tors is at least equal to 30%. These measures apply to profits made from 1 January 2021, which will be declared in 2022 and subsequent years.
The following companies are subject to corporate income tax at a rate of 10%:
• Artisanal, fishing, agricultural and fisheries vessels equipment companies
• Purchasing offices for retail sales companies organized in the form of cooperatives
• Service cooperatives formed between producers for the whole saling of their production
• Consumer cooperatives governed by the general statute of cooperation
• Commercial and industrial projects benefiting from the youth employment program or the national promotion fund for crafts and small trades
As of 1 January 2021, all transitional regimes granting tax advan tages for exports in terms of direct taxes are eliminated from the Tunisian tax system.
As of January 2022, the value-added tax (VAT) suspension regime for exporting service companies and international trade companies is eliminated. The VAT suspension regime no longer covers the following companies:
• Fully exporting service companies and fully exporting interna tional trade companies
• Service companies and international trade companies whose turnover from exports or sales under tax suspension exceeds 50% of their total turnover
• Service companies and international trade companies that carry out import and local acquisition activities of materials, products and services necessary for the performance of export activities
Before the enactment of the 2022 Finance Act, sales and services and products in the local market by industrial fully exporting companies operating in Tunisia could not exceed 30% of the total turnover. However, the 2022 Finance Act increased this percent age to 50%, starting from 2022.
Service companies in the hydrocarbons sector as well as sales and provision of services whose use is intended for abroad are subject to corporate income tax at a rate of 15%. These provi sions apply to profits made from 1 January 2021, which will be declared during 2022 and subsequent years.
Under the 2021 Finance Law, the minimum corporate income tax due is 10% of the tax base for companies subject to corporate income tax at a rate of 15%, and 20% of the tax base for those subject to corporate income tax at a rate of 35%. These provi sions apply to profits made from 1 January 2021, which will be declared during 2022 and subsequent years.
The rate of the advance due from fiscally transparent entities is reduced from 25% to 15% on the basis of the profits made for the preceding year. This rate is reduced to 10% for profits subject to corporate income tax at a rate lower than 15% at the level of associates and members of legal entities, as well as for profits accruing to associates and natural person members benefiting from the deduction of two-thirds of income in accordance with Personal and Corporate Income Tax Code (PCITC). These provi sions apply to advances due from 1 January 2021.
Tax benefits, such as total or partial exemptions from some taxes and duties, may be granted to companies such as those established in Regional Development Areas or some companies incor porated during 2018, 2019 or 2020.
Under Article 38 of the 2020 Finance Act, a tax relief is granted to companies that proceed to list their shares on the TSE alternative market (regardless of the opening rate of their capital) and that are subject to the corporate tax rate not exceeding 25% for the first four years following the listing year. The following are the percentages of the tax relief:
• 100% for the first year following the initial public offering year
• 75% for the second year
• 50% for the third year
• 25% for the fourth year
The 2022 Finance Act extended the deadline for the benefit of the transitional measures provided by the investment law and the law on the recasting of tax benefits covering tax and financial benefits until 31 December 2023.
Social Contribution of Solidarity. The 2018 Financial Act intro duced a new Social Contribution of Solidarity (SCS) for the companies and enterprises subject to corporate income tax, as well as companies not subject to corporate income tax.
This contribution is imposed at a rate of 1% of the taxable income and profits. The amount due for companies not subject to corporate income tax is TND200.
The SCS applies to income and profits realized on or after 1 January 2018.
Under the 2020 Finance Act, the SCS rate to be reported in 2020, 2021 and 2022 for persons subject to corporate tax rate at 35% is set at the following:
• 3% for Tunisian banks and financial institutions, nonresident banks and financial institutions operating within the framework of the code of financial services provisions for nonresidents, and insurance and reinsurance companies, including mutual insurance companies, Takaful insurance and participants funds (a type of Islamic finance instrument)
• 2% for other persons subject to the 35% corporate tax rate. However, for large commercial areas (supermarkets or hypermarkets), the CSS increase applies to profits reported during 2021 and 2022.
Capital gains. Capital gains are included in ordinary income and are taxed at the regular corporate income tax rate. For nonresident and non-established companies in Tunisia, capital gains derived from the sale of shares is subject to withholding tax at a rate of 15%, which is levied on the difference between the sales price and the acquisition price, reduced by the expenses incurred on the sale including the share premium. In all cases, the tax on capital gains may not exceed 5% of the selling price.
These provisions apply to withholding taxes payable from 1 January 2021.
As an option, a tax return on capital gains may be filed.
Withholding tax on income from movable capital. The 20% with holding tax on income from movable capital realized before 1 January 2022 is final and not subject to restitution, notwith standing the tax regime of the beneficiary of the income. For purposes of this tax, income from movable capital includes, among others, certain types of interest income. The tax applies to resident and nonresident companies and individuals.
Starting from 1 January 2022, investment income, including income from movable capital, is subject to a flat rate withholding tax instead of the discharging withholding tax mechanism before 2022. A taxpayer must integrate the investment income generated in 2022 in the corporate or personal income tax base and deduct from the tax due on a consolidated basis that takes into account all the income generated and the deductions made.
If the deductions result in a credit, the taxpayer will not be able to claim the refund of the unused excess.
According to administrative doctrine, the 20% withholding tax, which applies to all income from movable capital, other than those made in foreign currency or convertible dinars, is not only final, but also nondeductible and nonrefundable.
Administration. The financial year is generally the calendar year.
Tax returns must be filed by the 25th day of the third month fol lowing the end of a company’s financial year. Consequently, for companies using the calendar year as their financial year, tax returns are due by 25 March. For companies subject to mandatory audit, this return can be considered a temporary tax return and a definitive return must be submitted by 25 June.
Starting from the second year of their activities, companies must pay tax in three installments. Each installment is equal to 30% of the corporate income tax due for the preceding financial year. The installments are payable by companies during the first 28 days of the sixth, ninth and twelfth months following the end of the financial year. The balance of tax due must be paid when a tax bill (a document that specifies the amount of tax due and when the tax must be paid) is filed. Exceptionally, companies affected by the repercussions of the COVID-19 pandemic can file the declara tion relating to the third installment due during 2020 and all declarations relating to the installment payments due during 2021 without payment. These companies can file during 2021 the annual tax return for 2020 without payment. Such tax must be paid by the end of May 2022. These companies may pay such tax without advance and according to a fixed payment schedule by order of the Minister responsible for finance during the period from 1 January 2022 until the end of May 2022.
Dividends. Dividends paid to resident and nonresident individuals and nonresident entities in Tunisia are subject to a 10% withhold ing tax subject to a preferential rate provided for by the double tax treaty concluded between Tunisia and the country of resi dence of the beneficiary of the dividends.
Profits realized in Tunisia by Tunisian establishments of foreign companies are assumed to be distributed for the benefit of the partners not resident in Tunisia and are accordingly subject to a 10% withholding tax for distributions subject to a preferential
rate provided for by the double tax treaty concluded between Tunisia and the country of residence of the beneficiary of the profits. This withholding tax is imposed at a rate of 25% if the establishments have their head offices in low-tax jurisdictions.
Royalties. Subject to the provisions of double tax treaties, a 15% withholding tax is imposed on royalties paid to nonresidents. This tax applies to the following types of payments:
• Copyright royalties
• Payments for the use of, or the right to use, patents, trademarks, designs, models, plans, formulas, manufacturing processes and movies, including proceeds received from sales of such items
• Payments for the use of, or the right to use, industrial, commer cial, agricultural, harbor or scientific equipment, except for amounts paid to charter a plane or vessel for international operations
• Payments for information concerning industrial, commercial or scientific experience
• Payments for technical or economic studies or for technical assistance
Foreign tax relief. Tunisia does not grant any relief for foreign taxes.
C. Determination of trading income
General. Taxable income is based on financial statements prepared in accordance with generally accepted accounting principles, subject to certain adjustments.
Business expenses are generally deductible unless specifically disallowed by the tax law. Expenses that are deductible include, but are not limited to, the following:
• All types of expenses relating to production or the operation of a business, such as salaries and wages, and raw materials.
• Tax depreciation (see Tax depreciation).
• Attendance fees paid to members of the board of directors or the supervisory board.
• Interest paid to shareholders on loans if the amount of the loan does not exceed 50% of authorized capital, if the interest rate does not exceed 8% and if the share capital is fully paid up.
• Donations and subsidies paid to charities and organizations established for the public good that are engaged in philan thropic, educational, scientific, social or cultural activities, up to a maximum deduction of 0.2% of gross turnover.
• Research and development (R&D) expenses incurred within the framework of agreements concluded for this purpose with public scientific research establishments or public higher edu cation and research establishments on the condition that the participation of companies in the total expenses is not lower than 10%. They are deductible at a rate of 50% and within a limit of TND200,000 per year in accordance with Article 21 of the 2022 Finance Act.
• Amounts paid to social funds established for employees in accordance with the law.
• Gifts and meal expenses, up to a maximum deduction of the lower of 1% of annual gross income or TND20,000.
• Sponsorships allocated to the incorporation and the mainte nance of green spaces as well as family and rural parks, within
the framework of conventions concluded to this effect with the ministry in charge of the environment or the ministry in charge of infrastructure and housing, are deductible in determining the base subject to corporate income tax, up to the threshold of TND150,000 per year.
Expenses that are not deductible include, but are not limited to, the following:
• Fines, forfeitures and penalties of any kind, as well as transac tions designed to avoid the application of higher penalties
• Charges on passenger cars of more than nine horsepower
• Expenses related to aircraft, pleasure craft and second homes
• Expenses amounting to over TND5,000 that are paid in cash
• Charges invoiced by persons established in low-tax jurisdictions
Inventories. Inventories are valued at cost.
Provisions. Doubtful debts of up to TND100 (TND500 for banks) per debtor are deductible if they were due at least one year prior to the date on which they were written off and if the company has had no further business relationship with the debtor.
The following provisions are deductible, up to a maximum deduc tion of 50% of taxable income:
• Reserves for doubtful debts for which recovery is being pursued in the courts
• Provisions for finished goods
• Provisions for depreciation of shares of listed companies
Banks may deduct bad debt provisions from their tax base with out any limit. This deduction can result in a tax loss.
Tax depreciation. Under the Tunisian Tax Code, depreciation must be computed using the straight-line method. Depreciation is de ductible only if it is recorded in the accounts.
Standard depreciation rates allowed in Tunisia include, but are not limited to, the following.
Asset Rate (%)
Patents and trademarks 20
Capitalized R&D costs 20
5
furniture and equipment 20
and machinery 15
20
Movable equipment 10/20
15/20/33.33
6.25
hardware and software 33.33
For equipment other than transportation equipment, the depreciation rates may be increased by 50% if the equipment is used at least 16 hours a day and may be doubled if it is used 24 hours a day.
The costs of setting up a business may be amortized at a rate of 33% if the costs are very high. Otherwise, 100% of the costs may be deducted in the year of expenditure. Assets worth less than TND200 are fully deductible in the year of acquisition.
The following types of depreciation are not deductible:
• Depreciation of assets exceeding an amount of TND5,000 that are acquired for cash
• Depreciation of aircraft, pleasure craft and second homes
• Depreciation of land and ongoing businesses
• Depreciation that exceeds the maximum allowed rates
• Depreciations of passenger cars with more than nine horse power
• Depreciation of assets acquired from persons established in low-tax jurisdictions
Relief for losses. Losses may be carried forward five years, but may not be carried back. However, losses related to depreciation may be carried forward indefinitely.
Groups of companies. Tunisian law provides for the fiscal integra tion of related parties equivalent to a consolidated filing position if certain conditions are satisfied.
D. Other significant taxes
The following table summarizes other significant taxes.
Nature of tax Rate
Value-added tax, on all transactions carried on in Tunisia, including imports
Normal rate 19%
Other rates 7%/13%
Local tax (TCL); imposed on local turnover and exportations
Local turnover 0.2%
Professional training tax, on salaries, allowances and fringe benefits paid by an employer 1%/2%
Housing tax (FOPROLOS); on salaries, allowances and fringe benefits paid by employers 1%
Social security contributions, on employee’s annual salary; paid by Employer 16.57%
Employee 9.18%
Registration duties
Work contracts
TND30 per contract
0.5% of the contract value Company formation Constitution acts of companies or GIEs (a GIE is a type of tax-transparent entity) are exempt from registration duties
Business contracts
E. Miscellaneous matters
Foreign-exchange controls. For companies wholly or partially owned by nonresidents, the remittance of benefits, dividends, attendance fees and interest payments to nonresidents is guaran teed. Tunisian branches of foreign companies may freely remit their after-tax profits. Remittances must be made through a reg istered intermediary, which is generally a bank. Tunisian banks may obtain foreign loans not exceeding TND10 million a year. Tunisian companies other than banks may obtain foreign loans up to TND3 million per year.
Transfer pricing. The 2019 Finance Act established new rules for the determination of transfer prices and a new definition of entities’ dependency and control.
For the purpose of determining the tax due by resident or estab lished enterprises in Tunisia that are dependent on or control other enterprises belonging to the same group, the profits indirectly transferred to such enterprises either by raising or lowering the prices of transactions, or by any other means, are incorpo rated into the results of these enterprises.
Indirectly transferred profits are determined by comparison with those that would have been realized in the absence of any arm’slength or control relationship. The condition of dependence or control referred to above is not required if the transfer of profits is made with enterprises resident or established in a state or ter ritory whose tax system is privileged.
Dependency or control relationships are deemed to exist between companies if either of the following circumstances exists:
• One company directly or indirectly holds more than 50% of the share capital or voting rights of another enterprise or exercises the decision-making power of such enterprise.
• Companies are subject to the control of the same undertaking or the same person under the conditions mentioned in the first bullet above.
In addition, Article 30 of the 2019 Finance Act, as amended by the 2021 Finance Act, provides that companies resident or estab lished in Tunisia that are controlled by other companies or that control other companies under Article 48 Septies of the PCITC and whose gross annual sales exclusive of any turnover taxes is equal to or greater than TND200 million are required to submit an annual transfer-pricing declaration within the time frame for filing the annual corporate income tax return by using reliable electronic means according to a model established by the administration. In addition, these entities must present to the tax au thorities the transfer-pricing documentation when requested during a comprehensive tax audit. Under the 2021 Finance Act, only cross-border controlled transactions of which the amount exceeds TND100,000 must be reported within the annual Transfer Pricing Declaration and have to be covered by the transfer-pricing documentation.
The amendment affecting Article 48 Septies of the PCITC as well as the obligation to document transfer pricing applies to fiscal years beginning on or after 1 January 2020, provided that the requirements are the subject of a notice on or after 1 January 2021. The amendment concerning the transfer-pricing annual return applies to fiscal years beginning on or after 1 January 2020 (the first declaration must be filed in 2021).
Country-by-country reporting. Companies that are established in Tunisia and that fulfill all of the conditions fixed by the law are required to file within 12 months after the year-end date by any reliable electronic means, a Country-by-Country Report, based on a model established by the tax administration. The countryby-country declaration is subject to reciprocity through the auto matic exchange with the states that have concluded an agreement
with Tunisia for this purpose. These provisions are effective for financial years beginning after 1 January 2020.
E-commerce. Under the 2020 Finance Act, companies nonresident in Tunisia selling information technology solutions and internetbased services are subject to a royalty of 3% of the turnover earned from resident individuals and corporate entities. These nonresident companies must file a report regarding their abovementioned turnover on a quarterly basis. Reporting and payment procedures will be established by a governmental decree.
F. Treaty withholding tax rates
Dividends (t) Interest Royalties % % %
Algeria 20/30 15 15
Austria 20 (a) 10 10/15 (j)
Belgium 15 15 5/15/20 (b)(k)
Burkina Faso 8 5 5
Cameroon 12 15 15 Canada 15 15 15/20 (b)(l)
China Mainland 8 10 5/10 (aa)
Côte d’Ivoire 10 10 10
Czech Republic 10/15 (bb) 12 5/15 (cc)
Denmark 15 12 15 Egypt 10 15 Ethiopia 5 10 5
France 12 0/5/15/20 (b)(m) Germany 15 (a) 10 10/15 (n) Greece 10 15 12 Hungary 10/12 (bb) 12 12 Indonesia 12 12 15 Iran 10 10 8 Italy 15 12 5/12/16 (o)
Jordan (c) (x) (y) Korea (South) 12 15 Kuwait 10 2.5/10 (u) 5 Lebanon 5 5 5
Luxembourg 10 10 12 Mali 0/5 (dd) 5 10 Malta 10 12 12 Mauritania (c) (x) (y) Mauritius 0 2.5 2.5 Morocco (c) (i) 15 Netherlands 20 (v) 10 7.5/11 Norway 20 12 5/15/20 (b)(p) Oman 0 10 5 Pakistan 10 13 10 Poland 5/10 (ee) 12 12 Portugal 15 15 10 Qatar 0 (x) 5 Romania 12 10 12
Saudi Arabia 5 5 5 Senegal (c) 15
Dividends (t) Interest Royalties % % %
Serbia 10 10 10
Singapore 5 5/10 (gg) 5/10 (hh)
Slovak Republic 10/15 (bb) 12 5/15 (q)
South Africa 10 5/12 (z) 10/12
Spain 15 (d) 10 10
Sudan 0/5 (dd) 10 5
Syria 0 10 18
Sweden 20 (e) 12 5/15 (q)
Switzerland 10 10 10
Turkey 15 (f) 10 10
United Arab Emirates 0 2.5/10 (u) 7.5
United Kingdom 20 (g) 10/12 (s) 15
United States 20 (h) 15 10/15 (r)
Vietnam 10 10 10 Yemen 0 10 7.5
Non-treaty jurisdictions 10 20 (u) 15 (w)(ff)
(a) The rate is 10% if the recipient is a company that holds at least 25% of the capital of the payer.
(b) Tunisia applies a 15% rate instead of the highest rate.
(c) Dividends are taxed at the domestic rate of the country from which the divi dends originate.
(d) The rate is 5% if the beneficial owner of the dividends is a company that holds directly at least 50% of the capital of the payer.
(e) The rate is 15% if the recipient is a company that owns at least 25% of the capital of the payer.
(f) The rate is 12% if the recipient is a company that owns at least 25% of the capital of the payer.
(g) The rate is 12% if the beneficial owner is a company that controls directly at least 25% of the voting power of the payer.
(h) The rate is 14% if the recipient is a company that owns at least 25% of the capital of the payer.
(i) Taxed at the domestic rate of the country of domicile of the recipient.
(j) The 10% rate applies to royalties paid for the use of or right to use copyrights of literary, scientific or artistic works, but not including cinematographic and television films. The 15% rate applies to royalties paid for the use of or right to use the following:
• Technical and economic studies
• Cinematographic and television films
• Patents, trademarks, designs and models, plans, and secret formulas and processes
• Industrial, commercial and scientific equipment
• Information concerning agricultural, industrial, commercial or scientific experience
(k) The 5% rate applies to royalties paid for the use of or right to use copyrights of literary, scientific or artistic works. The 15% rate applies to royalties or other amounts paid for the use of or right to use the following:
• Patents, designs and models, plans, and secret formulas and processes
• Information relating to industrial, commercial or scientific experience
• Technical and economic studies
• Technical assistance relating to the use of the items mentioned above The 20% rate applies to royalties or other amounts paid for the use of or right to use trademarks, cinematographic and television films, and agricultural, industrial, harbor, commercial or scientific equipment.
(l) The 20% rate applies to royalties paid for the use of or right to use trade marks, cinematographic and television films or videotapes for television, and industrial, harbor, commercial or scientific equipment. The 15% rate applies to other royalties.
(m) The 0% rate applies to amounts paid to a public body of the other contracting state for the use of cinematographic films or radio and television broadcasts. The 5% rate applies to royalties paid for the use of or right to use copyrights
of literary, scientific or artistic works, but not including cinematographic and television films. The 15% rate applies to royalties or other amounts paid for the use of the following:
• Patents, designs and models, plans, and secret formulas and processes
• Information relating to industrial, commercial or scientific experience
• Technical and economic studies
The 20% rate applies to royalties or other amounts paid for the use of or right to use trademarks, cinematographic and television films, and agricultural, industrial, harbor, commercial or scientific equipment.
(n) The 10% rate applies to royalties or other amounts paid for the use of or right to use the following:
• Copyrights of literary, scientific or artistic works, but not including cine matographic and television films
• Information concerning agricultural, industrial, commercial or scientific experience
• Economic and technical studies
The 15% rate applies to royalties paid to use patents, trademarks, designs and models, plans, secret formulas and processes, and cinematographic and tele vision films.
(o) The 5% rate applies to royalties relating to literary, scientific or artistic works. The 16% rate applies to royalties relating to trademarks, cinematographic and television films, or industrial, commercial or scientific equipment. The 12% rate applies to other royalties.
(p) The 5% rate applies to royalties paid for the use of or right to use copyrights of literary, scientific or artistic works, but not including cinematographic and television films. The 15% rate applies to royalties or other amounts paid for the use of patents, designs and models, plans, and secret formulas and pro cesses; information relating to industrial, commercial or scientific experi ence; or technical or economic studies. The 20% rate applies to royalties or other amounts paid for the use of or the right to use trademarks; cinemato graphic and television films; and agricultural, industrial, harbor, commercial or scientific equipment.
(q) The 5% rate applies to royalties paid for the use of or right to use copyrights of literary, scientific or artistic works, not including motion picture and tele vision films. The 15% rate applies to other royalties.
(r) The 10% rate applies to royalties paid for the use of or the right to use industrial, commercial or scientific equipment, or to remuneration for the performance of accessory technical assistance for the use of property or rights described above, to the extent such technical assistance is performed in the contracting state where the payment for the property or right has its source. The 15% rate applies to royalties or other amounts paid for the use of or right to use copyrights of literary, artistic and scientific works, including cinematographic and television films and videotapes used in television broadcasts; patents, trademarks, designs and models, plans, and secret formulas and processes; and information relating to industrial, commercial or scientific experience.
(s) The 10% rate applies if the beneficial owner of the interest is a bank or other financial institution. The 12% rate applies to other interest.
(t) Under Tunisian domestic law, dividends are not subject to tax. Consequently, withholding tax is not imposed on dividends paid from Tunisia to other coun tries.
(u) A 10% rate applies to interest paid to banks.
(v) The rate is 0% if the beneficiary of the dividends owns at least 10% of the payer.
(w) For further details, see Section B.
(x) Interest is taxed at the domestic rate of the country from which the interest originates.
(y) Royalties are taxed at the domestic rate of the country from which the royal ties originate.
(z) The 5% rate applies to interest paid to banks.
(aa) The 5% rate applies to payments for technical and economic studies as well as for technical assistance.
(bb) The 10% rate applies if the beneficial owner of the dividends is a company that holds directly at least 25% of the capital of the payer.
(cc) The 5% rate applies to royalties paid for the use of, or the right to use, copyrights of literary, scientific or artistic works including cinematographic and television films. The 15% rate applies to royalties or other amounts paid for the following:
• The use of patents, designs and models, plans, and secret formulas and processes
• Information relating to industrial, commercial or scientific experience
• Technical or economic studies
• Technical assistance
• The use of, or the right to use, trademarks and industrial, commercial or scientific equipment
(dd) Dividends are exempt from tax if the beneficial owner of the dividends is a company that holds at least 25% of the capital of the payer.
(ee) The 10% rate applies if the beneficial owner of the dividends is a company that holds directly at least 25% of the capital of the payer.
(ff) This rate is 25% if the beneficiary is resident in a jurisdiction listed as a low-tax jurisdiction in the Ruling of the Minister of Finance dated 25 March 2019. Persons are resident or established in a low-tax jurisdiction or state if the tax due in that state or jurisdiction is less than 50% of the personal in come tax or corporate income tax due in Tunisia for the same activity. The following are categories of low-tax states or jurisdictions:
• States or jurisdictions in which the corporate income tax rate is less than 5% for activities subject to tax at the rate of 10% in Tunisia
• States or jurisdictions in which the corporate income tax rate is 12.5% for activities subject to tax at a rate of 25% in Tunisia
• States or jurisdictions in which the rate is 17.5% for activities subject to tax at a rate of 35% in Tunisia
The Ruling of the Minister of Finance dated 25 March 2019 provides listings of the states or jurisdictions falling into the above categories. (gg) The 5% rate applies if the beneficial owner of the interest is a bank or other financial institution. The 10% rate applies to other interest. (hh) The 5% rate applies to payments for technical assistance.