Identifies common practices used in selling in this market, including sales material that needs to be in the local language.
U.S. businesses should be aware that investors could face difficulties in transferring money to Sudan as international financial entities continue to exercise extreme caution in processing transactions.
Sudan has not had access to international banking institutions as it was under comprehensive U.S. economic and financial sanctions until late 2017. Despite lifting of these comprehensive sanctions, international banks have remained wary of operating in Sudan due to reputational risk associated with Sudan’s designation as a state sponsor of terrorism (which President Trump announced would be lifted in October 2020). Most foreign banks operating in Sudan are based in Gulf states, such as Saudi Arabia, United Arab Emirates, or Qatar. Sudan also faces a monetary crisis, with limited foreign exchange and a significant currency black market. Sudan’s annual inflation rate as of October 2020 was 220 percent, up from 71 percent in February and 64 percent in January. The official exchange rate is 55 SDG:1 USD, however the unofficial rate has ranged as high as 250 SDG:1 USD in October 2020.
The Central Bank of Sudan lists banks operating in Sudan at:
Trade Promotion and Advertising
Include web links to local fair or trade show authorities and local newspapers, trade publications, radio/TV/cable information, and your BSP, FUSE or single company promotion services.
The World Bank’s Ease of Doing Business 2020 Report notes that paying taxes in Sudan requires 42 payments and 180 hours per year, with the total tax and contribution rate comprising 45.4 percent of profit.
A company is deemed to be tax resident in Sudan if it is incorporated in Sudan under the Companies Act, 1925 or if the management and control of its affairs are exercised in Sudan in the relevant tax year. Resident companies are liable for tax on their worldwide income, whilst non-resident companies pay tax on profits derived from a Sudanese source only. Corporate tax rates in Sudan are dependent on the specific activity of each entity. Corporate tax is charged at the following rates:
- Manufacturing and real estate – 10 percent
- Commercial and services activities – 15 percent
- Oil & gas services – 35 percent
- Oil & gas distribution – 15 percent
- Telecommunications – 30 percent
- Banks – 15 percent
- Mining – 15 percent
- Cigarettes and tobacco companies – 2 percent
- Capital gains from sale of shares and bonds and capital assets – 15 percent
- Withholding tax royalties – 15 percent
- Management fee – 15 percent
- Interest received on the loans and other transfers from outside Sudan – 15 percent
- Final tax for the nonresident companies providing services in Sudan – 7 percent
VAT is levied at a standard rate of 17 percent. A special rate of 30 percent applies to telecommunications services. VAT applies to the supply of most goods and the provision of services, including importation of goods and services into Sudan.
The following activities are exempted from VAT:
All types of local agricultural products which are sold in their natural formLivestock, poultry and animal products, fish, milk and its productsFertilizersAgricultural seedsMedicines for human and animal usesLocally produced wheat flourBreadImported goods which are exempted from the tax and customs according to provisions of the Immunities and Privileges of 1956, ActGoods imported under the treaty exemption agreement with Sudan Government
The following services are exempted from VAT:
- Financial services, which include financial services for banks and money operating companies, financial funds and sale of share and securities and bonds
- Insurance services
- Education services
- Medical services
- Rentals and sale of real estate for residential purpose.
All goods and services which are exempted by the Minister of Finance and Economics according to the recommendations of the taxation secretary.
Capital Gains Tax
Capital gains tax is charged at 2 percent on gains from the sale of land and buildings, sale of vehicles, and sale of securities, shares. and bonds.
Stamp and Transfer Duty
Stamp duty rates vary in Sudan and are dependent on the type of instrument. Its overall rate is very nominal.
Transfer Pricing and Thin Capitalization
Transfer pricing is not applicable in Sudan.
Sales Service/Customer Support
Customer service levels are poor in comparison to international standards.
Principal Business Associations
The U.S-Sudan Business Council is a business association that has regular contact with the U.S. Chamber of CommerceThe Sudanese Business Club supports small to medium-sized (SME) businessess: www.sbc-sd.com Sudanese Businessmen and Employers Association: http://sudabiz.org/National Chamber of Importers: http://sudanimporters.org/WebsiteEng/aboutus.html
These organizations provide information to local business, but generally lack capacity and have very limited influence on the shaping of government regulations.
Limitations on Selling U.S. Products and Services
Despite the legal protections guaranteed under the National Investment Encouragement Act of 2013, there are foreign investment restrictions in the transportation sector, especially in railway, freight transportation, inland waterways, barge service, and airport operations. Most telecommunications and media, including television broadcasting and newspaper publishing, are closed to foreign capital participation. Foreign ownership is also restricted in the electrical power generation and financial services sectors. In addition to those overt statutory ownership restrictions, a comparatively large number of sectors are dominated by government monopolies, including those mentioned above. Such monopolies, together with a high perceived difficulty of obtaining required operating licenses, make it more difficult for foreign companies to invest.