Gabon Tax Breaks Cost Public Revenue $690 Million

In 2024, tax breaks for companies cost Gabon 403 billion CFA francs, about US$690 million, while oil and mining firms received 31% of the revenue the state gave up. That cost equaled 3.2% of gross domestic product and 22% of public revenue, according to the World Bank's Gabon Public Finance Review 2026.

The figures show a large share of public revenue going to business exemptions, even as Gabon's non-oil tax revenue averaged 10.5% of GDP between 2014 and 2024. The World Bank attributed that shortfall to tax breaks and weak compliance, not low tax rates. It said no one had rigorously assessed the commitments companies made in return for exemptions.

Who Received the Relief

Domestic value-added tax exemptions topped the list at 206.9 billion CFA francs, about US$354 million. The oil refinery received 41% of that relief, banks 25% and telecommunications companies 9%, the report said.

Customs exemptions cost 155.9 billion CFA francs, about US$267 million. Oil and mining received more than a quarter, while the cost-of-living programme got 15%. Excise relief totaled 32.6 billion CFA francs, about US$56 million, and went almost entirely to locally brewed beer.

Corporate tax relief came to 7.6 billion CFA francs, about US$13 million; the timber industry received 62%. Local breweries received 8% of all tax-break revenue, and banks received 6%. Exemptions intended to reduce the cost of basic goods accounted for 5.8% in the report's text, though its chart put cost-of-living exemptions at 13%. The report didn't explain the discrepancy.

Oil brought in about 40% of public revenue and 60% of export earnings in 2024. The World Bank said reliance on hydrocarbons leaves the budget exposed to oil-price changes. It also found that some large oil producers pay far less tax per unit of oil than others.

Public Revenue and Debt

The World Bank said tax breaks had continued to grow since 2022 despite a regional ban on discretionary exemptions. It found that some mining and oil companies offset VAT refunds owed to them against other taxes, although no legal provision allows it. Gabonese government officials told the Bank that some double-taxation treaties may cost the country more revenue than they should.

The report put public debt at more than 80% of GDP in 2025. Public spending stood at about 25% of GDP in 2023 and 2024. The US State Department's 2026 Fiscal Transparency Report found that Gabon didn't meet minimum requirements; only limited debt information was public, excluding debt held by state-owned companies.

Gabon also relies on foreign bond buyers. On 14 October, the finance ministry announced a US$580 million, eight-year bond with a 9.375% coupon. The World Bank presented tax changes as one way to contain debt while protecting priority investment.

Proposals and Budget Decisions

The World Bank recommended removing exemptions that may lack a legal basis, limiting stability clauses in new agreements and creating a joint body of tax, customs and other agencies to supervise incentives. It estimated that eliminating half the tax breaks outside the cost-of-living programme could raise up to 1.5% of GDP over the medium term.

The Council of Ministers adopted the 2027 budget bill on 18 September as part of the 2026 to 2030 national growth and development plan. On 15 October, the Federation of Gabonese Enterprises, which says it has about 1,100 member companies, told the Economic, Social, Environmental and Cultural Council it hadn't received a copy. The bill wasn't public by mid-October, so it remained unclear whether officials would reduce any exemptions. No government response to the World Bank's recommendations was reported.

The World Bank published its review on 29 September. Its breakdown covered only taxes with available data, so the full cost may be higher. The report also said the United States received 64% of its manganese ore imports from Gabon between 2021 and 2024; the US Geological Survey said the United States had produced no manganese ore with 20% or more manganese content since 1970. Manganese is used mainly in steelmaking.