We review in this page some of the important Libyan Tax & Accounting Laws:

1. Law No. (11) 2004 regarding Income Tax
2. Executive Regulation for Law No. (11) 2004 regarding Income Tax
3. Law No. (12) 2004 regarding Stamp Tax
4. The Executive Regulations Of Stamp Tax Law No. 12 for 2004
5. Law No. (5), and its amendment by Law (7) for Promotion of foreign investments
6. Law No. (1) 2005 regarding banks
7. Law No. (2) 2005 on Combating Money Laundering
8. Law No.(1) to amendment the Law No. (21) for economic activities.
9. Executive Regulation for Law No. (21) for economic activities.

Law No. (11) 2004 regarding Income Tax

The Income Tax Law clarifies the different kinds of direct taxes. These taxes are imposed on various profits that companies make. Using the kind of activity, this law classifies the taxes on profits into seven categories. This Law defines companies as national limited companies and branches of foreign companies. The law uses six profit brackets on a progressive basis. The first bracket rate is 15% on net profits that would not exceed 200,000 L.D, it reaches 40% on net profits that exceed 500,000 L.D, In addition to 4% (Jehad Tax) on net profit. The Law sets the measures that organize the relationship between The Tax Department and tax Payers.

Executive Regulation for Law No. (11) 2004 regarding Income Tax

This regulation sets the procedure and rules for the application of the Income Tax Law, tax payers census, tax collections, submission of tax declaration dates and litigation against the tax assessment.

Law No. (12) 2004 regarding Stamp Tax

This Law imposes the stamp tax. This tax is classified as an indirect tax. It is sometimes fixed on acts and writs. A list of these acts and writs is attached to the Law. The value of this tax on other acts and writs is calculated as a percentage of the value of acts and writs. The percentage ranges from 1% to 3% depending on the kind of acts and writs.

The Executive Regulations Of Stamp Tax Law No. 12 for 2004

This regulation determines the measures for the application of the Stamp-Tax Law. These taxes are imposed on acts and writs. It also defines the different categories of stamps which can be used and cancelled. In addition to that, it sets the rules for their trading.

Law No. (5), and its amendment by Law (7) for Promotion of foreign investments

This Law determines the incentives that are given to foreign investors to encourage them to invest in certain economic activities. Such activities are mentioned in Clause 8 (the national investors have become entitled to same incentives). These incentives include exemption from customs Duties on assets and materials necessary for carrying out the activity and from income taxes for five years. An extension of three can be granted according to clause 10.

Law No. (1) 2005 regarding banks

This Law defines the role and activities in the accomplishment of national economic objectives. It organizes foreign exchange operations in that it determines how and where it would be applicable within the banking sector in Libya.

Law No. (2) 2005 on Combating Money Laundering

This law determines the behaviors that are considered as money laundering crimes. It also includes the punishments for people who commit such crime, those who know it and do not report it to the concerned authorities, those who preach others to engage in it and the institutions that are used as bases for it. The legislator added international dimensions to the law by tracing the trail of crime regardless of whether they are originating from outside or inside Libya. The law Specifically mentioned the countries that have judicial cooperation treaties with Libya.

Law No.(1) to amendment the Law No. (21) for economic activities.

This law deals with the forms and the legal rights for allowed economic activities in Libya. There are five forms of business organization. The most important form is a limited liability company including parent company.

Executive Regulation for Law No. (21) for economic activities

This executive regulation determines in detail the legal requirements to set up various kinds of companies, including parent companies. And according to this regulation parent companies are defined as companies formed with the objective of owning the capital of another company or more companies (regardless of the business they are engaged in), or not less than 51% of their capital. The regulation also discusses other business organization such as limited liabilities companies and partnerships.