In the Republic of Mali, the tax system for forestry is not rigorously defined. Forestry law does, however, generally envisage tax obligations. Thus, apart from exceptional exemptions for users, there is no right to harvest forest products free of charge.

It goes without saying that all harvesters must pay fees and taxes in order to obtain harvesting rights, which are collected from the following permits:

However, income from forestry activities falls into the category of agricultural revenue and is, therefore, provisionally exempt from proportional taxes. But it should be stated that current legislation concerning regulations for agricultural profits within the General Tax Code have not yet been passed.

The only references in place for forestry taxation are essentially the following basic laws:

In analysing these laws, three types of forestry taxation emerge:

The main free user right is the right of individuals in rural communities resident in forests to harvest wood for their domestic use, provided that it is not for sale. This user right is fully exercised by all rural communities. Indeed, outside of urban centres (district county towns), rural populations are not subject to any tax. It should be noted that, in some cases, this user right is contravened and people sell wood. The main cause of this phenomenon is the general level of poverty.

Taxes on the production of roundwood

Industrial roundwood is any log or branch that is used in its round form (untreated) or as primary matter for mechanical or chemical transformation for obtaining finished products (sawnwood, planks, plywood etc.). The measurement unit used is the cubic metre or standing tree. In this report, roundwood is classed as industrial roundwood for processing (bois d’œuvre) if it is any log, trunk or block having a diameter greater than 25cm.

The forms or permits used for tax collection from roundwood harvesting are the same as those used for other forestry products. As well as the harvesting permit, a transport coupon is issued for monitoring the origin and circulation of forestry products.

With regard to fines on the fraudulent harvesting or transport of wood, when these are collected, a receipt or bill is issued from the public revenue department.

As a general rule, taxes on roundwood production are determined by Decree 98-402/P-RM of 17 December 1998, setting down the rates and methods of collection of taxes paid for the harvesting of wood from state forests.

All taxes paid for roundwood harvesting are paid to the Nature Conservation Service. The rates of tax depend on whether the products come from natural forests or state forest plantations and vary according to the type of harvesting and tree species.

However, with regard to the harvesting of wood in forests run by private individuals, taxes are paid by the harvester, whether they are the owner of the forest or just the holder of a harvesting permit. The taxes paid are either the fixed charges applied elsewhere (i.e. in the tax system for other types of forest) or are based on profits. The rate of tax on profits is an ad valorem tax of up to 10% (see Table 1 to Table 3 for the amounts and rates of taxes charged on the production of roundwood).

For other activities covered by the regulations on the use of state forests (e.g. making harvesting and access roads, bridges or other works, as well as establishing factories and barriers) there are no specific taxes. However, all large-scale work in these areas is subject to Decree number 99-189/P-RM of 5 July 1999 outlining the procedures and requirements for Environmental Impact Assessments.

Taxes on the production of industrial roundwood

The rates of tax collected from the harvesting of wood in state forests vary according to whether the products are from natural forests or state forest plantations and depend on the nature of the products (i.e. woodfuel, other industrial roundwood (bois de service) or industrial roundwood for processing (bois d’œuvre)).

The tax rate also varies according to the type of area harvested: uncontrolled; guided; or controlled (incontrôlée; orientée or contrôlée). This measure stems from the concern to direct wood harvesting towards controlled areas, so as to ensure that appropriate harvesting techniques are used (i.e. correct felling techniques, harvesting within the allowed quota). For controlled areas, the tax rate on the production of industrial roundwood for processing is varied according to the diameter of the wood. The greater the diameter, the higher the tax rate. This difference reflects the market value of the wood (see Table 1).

Table 1           Tax on the harvesting of industrial roundwood for processing from natural forest (in FCFA per standing tree)

Source: Decree number 98-402/P-RM.

The variation in the tax on other industrial roundwood from a harvesting zone (see Table 2) also comes from the same concern to direct harvesting to managed zones so as to have more rigorous monitoring of the harvesting norms and quotas. Harvesters tend to go to uncontrolled areas in spite of the high rate of tax because there they can escape forest monitoring.

Table 2           Tax on the harvesting of other industrial roundwood from natural forests (in FCFA per piece)

Source: Decree Number 98-402/P-RM.

Table 3           Tax on the harvesting of industrial roundwood for processing and other industrial roundwood from state forest plantations (in FCFA)

Source: Decree Number 98-402/P-RM.

The tax rate for harvesting industrial roundwood for processing and other industrial roundwood from state forest plantations depends both on the diameter of the wood and the quality of the wood. Therefore, species like Kaya sénégalensis, Gmelima arborea and Tectona grandis have the highest rates of tax levied on them (see Table 3).

Taxes on the production of woodfuel

Generally, for harvesting woodfuel in state forests, the rates of tax collected from natural forests vary by origin and type of product (essentially fuelwood and charcoal) and they vary by species in state forest plantations. Fuelwood and charcoal taxes are based on volume (per stacked cubic metre (stère) for fuelwood and per quintal for charcoal) and the rates of tax vary according to the nature of species and depending on where the harvesting took place (uncontrolled, guided or controlled harvesting – see Table 4). In state forest plantations, taxes are also based on volume (per stacked cubic metre) and apply to both native and exotic species (see Table 5).

Table 4           Tax on harvesting of woodfuel from natural forests

Source: Decree Number 98-402/P-RM.

Table 5           Tax on harvesting of woodfuel from state forest plantations

Source: Decree Number 98-402/P-RM.

Variation in the structure of regional forestry taxation

Because of the specific nature of different regions, the charges for issuing permits to clear land in state forests vary between regions. In the Sahelian zone, the fee for a permit to clear land with destumping is 7,500 FCFA/ha and the fee for clearing without destumping is 5,000 FCFA/ha. In the Sudanian zone, 15,000 FCFA/ha is charged for clearing with destumping as opposed to 10,000 FCFA/ha for clearing without destumping.

Taxes on non-wood forest products and services

In Mali, up until 2000, these products and services were not taxed because of a legal loophole. There is a flourishing business in these products and services both inside and outside the country. Non-wood forest products, such as: leaves; bark; roots; fruit; and herbs, provide significant income to a section of the population who devote themselves to collecting these products (mostly women and young people). Harvesting other products, such as: gum arabic; and shea tree kernels, is a flourishing export business and the revenue generated from these exports is significant (see Table 6). This legal loophole will soon be closed when the Cabinet passes a decree on this subject.

Table 6           Trends in exports of non-wood forest products 1990 - 1999

Source: National Office for Statistics and Data Processing, 1999.

Table 6           Trends in exports of non-wood forest products 1990 - 1999

Source: National Office for Statistics and Data Processing, 1999.

Taxes on the trade of forestry products and transformed products

Mali does not envisage any regulations on the taxation of transformed forestry products nor on the trade of forestry products. These are the concern of other public institutions.

Other taxes

In a broad sense, the tax system for forestry includes additional levies and taxes as set down in the General Tax Code. In effect, these additional levies are additional taxes levied on the harvesting of wood.

Environmental tax on wood

There is an Environmental Tax on Wood (ETW), which aims to cover the costs of forestry development and the implementation of sustainable forest management and to finance collective investments in villages. This tax is applied nationwide, with payment in the form of a Local Tax on Wood (LTW). This tax is redistributed in the form of a Forestry Policy Tax (FPT), which aims to provide incentives to the sector to act in the chosen direction or to directly finance forestry development activities. This tax is administered through a forestry network promotion fund, which is generally distributed amongst forestry professionals, the Permanent Association of the Malian Chambers of Agriculture (PAMCA) and the Nature Conservation Service (NCS).

Taxation of forests run by territorial communities

Decree number 98-402/P-RM of 17 December 1998, fixes the rates, methods of collection and distribution of taxes collected on the harvesting of wood in state forests. This decree does not mention the taxation of wood harvesting in forests run by territorial communities.

Territorial communities are authorised to apply taxation in their respective areas according to Article 25 of Law number 96-050 of 16 October 1996, applying the principles of the constitution to the management of the area of territorial communities. To this effect, the rates of tax collected in the case of wood harvesting in territorial community areas should be fixed by the competent authorities of the territorial community, following consultation with the chamber of agriculture.

In fact, the series of taxes decreed by the basic forestry taxation laws are automatically applicable to the activity and to the harvesters in the woodfuel sector. By referring to existing laws regarding the fiscal resources of towns, all executive authorities should deliberate on the rates of municipal taxes.

Fines

The rates of fines for the fraudulent transport of wood vary from 5,000 FCFA to 50,000 FCFA (Article 23 of Law 95-003).

The rates of fines for the fraudulent harvesting of fuelwood and charcoal vary by quantity and are shown in Table 7. In addition to these regulations, in Article 86 of Law 95-004, there are fines from 5,000 FCFA to 100,000 FCFA for the fraudulent harvesting of other forest products.

Table 7           Fines on the fraudulent harvesting of fuelwood and charcoal (in FCFA)

Source: Article 90, Law 95-004.

Offences related to illegal forest clearing are redressed with fines from 10,000 FCFA to 100,000 FCFA (Article 81 of Law 95-004).

Other national and local taxes

More general taxes are laid down in the General Tax Code and include:

value-added tax (VAT),  for which the methods of payment and rates (currently 18%) are fixed by the law;

various licence fees;

taxes on salaries; and

taxes on Industrial and Commercial Profit (ICP).

Some other taxes (and tax rates) are determined by the application of Law number 96-051 of 16 October 1996 determining the fiscal resources of towns. These are in principle comparable to municipal taxes.