Mozambique’s government plans to implement sweeping tax reforms and introduce AI tools to strengthen revenue collection by 2028, according to its Medium-Term Fiscal Scenario (CFMP) approved June 24.

Key measures include revising VAT and corporate tax codes, cutting ineffective tax exemptions, and expanding the tax base by formalizing the informal economy. The government will also launch a new tax regime for foreign digital services and update simplified tax structures.

The strategy includes investments in digitization, system interoperability, and AI tools to improve oversight, especially of large companies. Tax authorities will adopt real-time monitoring, forensic tax analysis, and predictive risk-based auditing.

Mozambique also aims to promote tax equity through more progressive taxation and comprehensive system harmonization. Special regimes and incentives will be reevaluated to correct market distortions.

By 2028, tax revenue is expected to rise from 417.4 billion meticais (€5.54 billion) in 2026 to 492.2 billion meticais (€6.54 billion), increasing from 25.4% to 25.7% of GDP. LNG revenues will remain modest at about 0.3% of GDP, as production scales and the Sovereign Fund framework matures.