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6. Appropriate Regulation
6.1 Fair Tax Regime
6.2 Professional Services
6.3 Capital Markets
In-Country Assessment Information

6. Appropriate Regulation – Very Weak

Goal – A comprehensive regulatory framework that is transparent, efficient, simple in its implementation and that leads to accurate reporting of property values and prudent protection from markets risks

 
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6.1 Fair Tax Regime

Core Question: Do market participants feel the overall tax rate is fair and participate in formal transactions? No – Very Weak, individual income tax is low but corporate tax rate is burdensome.

 

Transfer Tax

6.1.1   What is the total property transfer tax including all duties and payments?  3.1% –  Strong

 

Overall Tax

6.1.2   What is the overall tax rate on entrepreneurs? 53.2% – Very Weak, Ranking –  154th out of  185

Source: Doing Business 2013– Paying Taxes & Registering Property, World Bank, www.doingbusiness.org/data/exploreeconomies/angola

 

Divestment

Survey Question

SQ 28  What is the tax on profits for foreign investors when divesting property? 35% as business income/capital gains tax although government incentives for housing investment includes exemptions of 15 years for capital gains tax – Weak

Source: U.S. Embassy Commercial Information Section – http://angola.usembassy.gov/doing-business-local.html

 
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6.2 Professional Services

Core Question: Are the professional services necessary for efficient and transparent property markets available and appropriately regulated and supervised? No – Very Weak, the biggest problem is quality people for middle and upper management.

 

Valuers

Survey Questions

SQ 29  Are property valuers licensed and/or certified by the government?  No – Very Weak

Civil Society Resource: The Appraisal Foundation www.appraisalfoundation.org

 

SQ 30  How effective are mechanisms in place to discipline valuers who engage in misconduct? Very Weak – limited to professional ethics of visiting foreign firms

See pages 24-25 for in-country assessment information regarding valuers.

Civil Society Resource: International Real Property Foundation www.irpf.org

 

Brokers & Agents

Survey Questions

SQ 31  Are real estate brokers and agents licensed and/or certified by the government? No – Very Weak

SQ 32  How effective are mechanisms in place to discipline brokers or agents who engage in misconduct?  None in place – Very Weak

Civil Society Resource: International Real Property Foundation www.irpf.org


Mortgage Professionals

Survey Questions

SQ 33  Are mortgage professionals licensed and/or certified by the government? No – Very Weak, mortgage market is still under development

SQ 34  How effective are mechanisms in place to discipline mortgage professionals who engage in misconduct? Very Weak

 

 
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6.3 Capital Markets

Core Question: Are capital markets well-regulated and diversified enough to provide financial resources to private-sector entrepreneurs and innovators? No – Very Weak – capital markets still under development

 

Capital Flows

6.3.1   How restricted is the flow of capital into and out of the country?   Weak – Score 35 out of 100

Source:  2013Index of Economic Freedom, Heritage Foundation – www.heritage.org/index/Country/Angola

 

Securities Exchanges

6.3.2   Is the regulation of securities exchanges transparent, effective and free of influence from government and industry? No – Very Weak, stock market not yet functioning

Securitization

6.3.3   What is the depth of asset-backed securities, mortgage-backed securities, high-yield bonds and highly leveraged loans? Very Weak – primary markets still under development

 

 
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In-Country Assessment (as of Jun 2007)

Taxation

FQ 21.What is the overall taxation system in regards to property?

Capital gains are treated as ordinary business income and taxed at 35%. The standard rate of sales tax is 10%. In some cases the sales tax is reduced to 2% (domestic supplies and some commodities) while increased tax rates of 20 – 30% apply to commodities which are essentially luxury goods. Stamp duty applies to transactions, acts, deeds, documents, papers, receipts and other transactions. For property transfers the rate is around 11%.
Source: National Agency for Private Investment http://investinangola.com/engBusinessTax.asp

 

Brokerage

FQ 22. What is the number of practitioners in the country including full-time brokers/agents with formal training and part-time, informal brokers?

There are perhaps 100 serious real estate brokers mostly focused on the rental market for expat workers, with apartments renting for $15,000 to $20,000 per month.

 

FQ 23. What is the number and average size of brokerage companies?

Real estate development is very active and most sales are done in-house by large engineering and construction or development and management firms from Brazil, South Africa and Portugal. Banks (both Angolan and foreign owned banks) also help connect buyers and sellers.

 

FQ 24. Are there brokers associations active in the market? What number and what percentage of practitioners belong? No

 

FQ 25. What training programs are available to enhance productivity? None

 

FQ 26. Is there a Code of Ethics or standards that practitioners follow? Is the Code enforced? No

 

FQ 27 Do civil society organizations exist to support the developments of mortgage professionals? No

Source: IRPF Assessment June 2007