## _cr04320 — Selected Economic and Fiscal Indicators; Tax System (Timor-Leste) ## Source details **Canonical URL:** [_cr04320 — Selected Economic and Fiscal Indicators; Tax System (Timor-Leste)](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2004/_cr04320.pdf) ## Other formats - [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2004/_cr04320.pdf.md) - [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2004/_cr04320.pdf.json) --- ### Output, prices, and growth - GNP at current prices (millions of U.S. dollars): 270 329 400 397 372 - GDP: 270 321 387 381 341 - Oil/gas income: 0 8 13 17 31 - Real GDP growth (percentage change): -3 5 1 5 3 -3 - Inflation (percentage change at end-period): 1/ 14 0 3 0 1 0 4 - Note: Rupiah-based CPI for Dili through 2000 and, thereafter, dollar-based CPI for Dili. ### Investment, savings, and external savings - Gross investment 2/: 21 33 31 29 27 - Excludes investment relating to the oil/gas sector. - Gross national savings: -13 -5 -3 -4 -7 -3 -2 - External savings: 34 85 78 73 60 ### Government budget (CFET) and combined-sources fiscal operations (selected) - Government budget (CFET) revenues (percent of GDP): ... 7.7 8.1 13.5 17.7 - Domestic revenues: ... 4.0 5.3 5.3 8.2 - Oil/gas revenues: ... 3.7 2.8 8.2 9.5 - Expenditure (percent of GDP): ... 14.5 13.7 19.6 22.1 - Recurrent expenditure: ... 8.4 10.7 15.6 19.0 - Capital expenditure: ... 6.1 3.0 4.0 3.1 - Overall balance (percent of GDP): ... -6.8 -5.5 -6.1 -4.4 - Combined sources fiscal operations (millions of U.S. dollars) - Revenues: ... 8 9 15 19 - Expenditure (sequence shown): ... 12 21 21 10 5 9 1 (table shows sequence 12212110591) - Recurrent expenditure: ... 9 6 9 7 8 2 7 2 - Capital expenditure: ... 2 6 2 3 2 2 1 9 - Overall balance: ... -114 -111 -90 -72 - Central Government Budget Operations (CFET), FY2000/01–FY2004/05 (selected, in millions of U.S. dollars) - Revenue (FY series): 27.1 31.3 48.8 59.8 45.1 59.3 67.2 - Domestic revenues: 14.1 20.5 19.3 17.6 20.3 27.5 23.0 - Oil/gas revenues: 13.1 10.8 29.5 42.2 24.8 31.8 44.2 - Royalties and interest: 3.1 4.3 3.1 12.9 7.7 4.6 25.8 - Expenditure: 51.3 52.6 70.8 79.1 74.6 74.1 75.1 - Recurrent expenditure: 29.6 41.1 56.2 66.8 64.2 63.7 64.9 - Capital expenditure: 21.7 11.5 14.5 12.3 10.4 10.4 10.2 - Overall balance (percent of GDP): -24.2 -21.3 -22.0 -19.3 -29.5 -14.8 -7.9 - Alternative overall balance (percent of GDP, alternative row): -6.8 -5.5 -6.1 -5.8 -8.8 -4.4 -2.4 - Memorandum: - Cumulative oil/gas savings (end-period): 3.1 7.4 10.5 22.4 18.3 15.1 41.0 - CFET cash balances (end-period): 8.9 6.3 14.8 6.0 11.3 31.0 28.0 - Non-oil overall fiscal balance (percent of GDP): -37.3 -32.0 -51.4 -61.5 -54.3 -46.6 -52.1 ### Oil/gas revenues and receipts - Oil/gas revenues (FY series, millions of U.S. dollars): Total oil/gas revenues 13.1 10.8 29.5 42.2 24.8 31.8 44.2 (Table 11) - Tax revenues: 9.9 6.5 26.4 29.3 17.1 27.2 18.3 - Royalties and interest: 3.1 4.3 3.1 12.9 7.7 4.6 25.8 - Oil/gas receipts (2000–2003) - Total oil/gas receipts (2000 2001 2002 2003): 8.1 12.5 16.5 31.2 - Royalties (first tranche petroleum): 3.1 4.2 0.0 4.3 - Tax revenues: 5.0 8.2 16.4 26.8 - Total oil/gas receipts (as percent of GDP): 2.5 3.2 4.3 9.1 - Royalties (percent of GDP): 1.0 1.1 0.0 1.3 - Tax revenues (percent of GDP): 1.5 2.1 4.3 7.9 - Memorandum: - Oil/gas revenues (1999–2003): 0 8 13 17 31 - Gross foreign assets (end-period): 0 16 24 44 61 - O/w: Oil/gas revenue savings: 0 37 71 1 ### Money, credit, and banking sector (selected) - Broad money (end-period, millions of U.S. dollars): 48 61 31 42 1 (table shows sequence 486131421) - Net domestic assets (end-period): 47 -4 -4 -9 -11 - Monetary survey (selected, end of period, millions of U.S. dollars) - Net foreign assets (selected): 33.8 65.4 72.9 68.9 77.3 89.9 92.8 99.7 103.1 108.3 133.7 - Cash holdings (selected): 6.3 11.7 12.1 7.7 12.4 18.1 15.1 10.5 15.3 19.0 28.6 - Claims on foreign banks (selected): 27.5 61.2 68.8 65.0 68.1 75.3 81.9 94.1 90.7 122.6 125.6 - Net domestic assets (selected): -13.8 -14.3 -17.7 -18.5 -22.5 -35.3 -38.4 -41.9 -37.6 -36.0 -58.7 - Claims on government (net): -19.0 -21.1 -22.3 -19.2 -20.9 -33.7 -36.3 -41.5 -28.3 -49.7 -74.3 - Loans and advances to private sector: 0.3 3.0 3.5 4.4 4.5 5.1 6.1 7.8 12.6 22.1 32.4 - Broad money 2/: 20.0 51.1 55.2 50.4 54.8 54.6 54.4 57.7 65.5 72.3 75.0 - Demand deposits: 19.3 36.9 40.1 36.1 39.6 39.1 37.5 39.2 43.1 40.1 44.0 - Saving deposits: 0.0 8.2 9.7 8.4 9.4 10.2 11.7 13.7 16.6 22.6 25.1 - Time deposits: 0.7 6.0 5.4 5.9 5.8 5.3 5.2 4.9 5.8 9.6 6.0 - Bank loan/broad money ratio (memorandum): 1.5 5.9 6.3 8.6 8.2 9.4 11.1 13.5 19.2 30.6 43.1 - Banking system composition: Banking and Payments Authority (BPA), three commercial banks, and one microfinance institution. - Note: Excludes currency in circulation due to dollarization; figures after 1999 exclude currency holdings by the public. ### Balance sheet of the Banking and Payments Authority (selected; end of period, millions of U.S. dollars) - Net foreign assets (memorandum series): 16.0 23.7 28.2 26.7 33.2 43.5 46.3 51.4 42.3 61.3 86.8 - Claims on central banks (selected): 14.7 18.8 19.5 21.0 24.8 30.5 34.1 43.6 32.1 54.4 66.4 - Reserve Bank of Australia — Timor Sea account (selected): 3.1 7.4 7.4 7.4 7.4 7.5 10.5 10.5 10.6 10.6 13.9 - Reserve Bank of Australia — Current accounts with RBA (selected): 11.6 11.4 12.2 13.5 17.3 23.0 23.6 33.1 21.6 43.9 52.5 - Net domestic assets (selected): -16.0 -22.7 -25.7 -23.1 -27.8 -39.1 -42.3 -46.6 -34.8 -55.0 -80.9 - Government (net position) and Timor Sea account components are reported (e.g., Timor Sea account: -3.1 -7.4 -7.4 -7.4 -7.4 -7.5 -10.5 -10.5 -10.6 -10.6 -13.9) ### Consolidated balance sheet of financial institutions (selected) - Net foreign assets (memorandum): 17.8 41.7 44.7 42.2 44.1 46.4 46.5 48.3 60.8 47.0 47.0 - Net domestic assets (memorandum): 5.2 12.9 12.3 10.6 11.6 10.7 9.7 11.5 6.2 28.8 30.6 - Deposit liabilities (memorandum): 20.0 51.1 55.2 50.4 54.8 54.6 54.4 57.7 65.5 72.3 75.0 - Demand deposits: 19.3 36.9 40.1 36.1 39.6 39.1 37.5 39.2 43.1 40.1 44.0 - Interest rate ranges (annual rates as of March 2004): bank loans 14.0-19.0; on-lending under SEP 10.0 (deposit and lending ranges provided in full in source). ### External sector and balance of payments (1999–2003) - Current account excl. official transfers (millions of U.S. dollars): -92 -279 -309 -292 -230 - Current account incl. official transfers: 648 544 444 443 - Trade balance (millions of U.S. dollars): -67 -235 -264 -245 -195 - Merchandise exports 6/7/: 5 2 5 4 6 7 (table shows 525467) - Merchandise imports 6/: -119 -240 -268 -251 -203 - Services (net): -25 -48 -49 -48 -40 - Income (net): 0 3 5 16 - O/w: Oil/gas royalty and interest: 0 3 4 0 4 - Current transfers (net): 98 32 73 63 33 36 2 73 (table shows sequence 98327363336273) - O/w: Oil/gas tax revenues: 0 5 8 16 27 - International assistance: 4 33 15 34 73 14 2 40 - Capital and financial accounts: -3 -54 -61 -36 -16 - Official capital transfers: 0 7 17 47 15 8 - Overall balance (millions of U.S. dollars): 0 1 6 8 20 18 - Current account excl. official transfers (percent of GDP): -34 -87 -80 -77 -67 - Current account incl. official transfers (percent of GDP): 215 141 121 213 - Trade balance (percent of GDP): -25 -73 -68 -64 -57 - Memorandum items: - Oil/gas revenues: 0 8 13 17 31 - Gross foreign assets (end-period): 0 16 24 44 61 - O/w: Oil/gas revenue savings: 0 37 71 1 ### Sectoral composition of GDP and expenditure (1998–2003) — selected - Total GDP at current prices (selected): 390.4 270.1 321.2 387.4 380.7 341.2 - Consumption and investment shares, gross national savings, and external savings series are reported across 1998–2003 in source tables. ### Consumer Price Index (Dili), 2000–2004 (April 2000 = 100.0) — selected - Annual average indices: 2000 = 100.0; 2001 = 113.5; 2002 = 118.9; 2003 = 127.4; 2004 (partial) Jan–Apr = 130.0 130.1 130.3 130.9 - Year-on-year percentage change 2003 annual average: 7.2 ### Public sector employment and wages (FY2000/01–FY2004/05) — selected - Total government employees (selected FYs): 11,164 10,012 14,817 12,569 16,387 13,170 17,150 14,300 17,175 - Public sector pay-scale: average wage for each grade L1–L7 reported; pay-scale not changed since FY2000/01. ### Operations of the Power Authority and Autonomous Agencies (selected) - Power Authority (FY series) - Total retained revenues (percent of GDP): 1.4 4.4 4.9 6.9 5.9 5.3 8.4 - Total expenditures (percent of GDP): 8.8 9.1 12.6 13.5 13.5 12.7 13.6 - Overall balance (percent of GDP): -7.4 -4.7 -7.7 -6.6 -7.6 -7.4 -5.3 ### Revenue collection and tax system (selected) - Total domestic revenue (percent of GDP series): 14.1 20.5 19.3 17.6 20.3 27.5 23.0 - Tax revenue (percent of GDP series): 12.2 18.1 17.0 14.9 17.2 23.0 19.0 - Taxes collected at the border (memorandum, percent of GDP): 9.9 10.7 9.8 8.7 10.0 14.4 11.5 (In percent of GDP) 2.8 2.8 2.7 2.6 3.0 4.3 3.5 ### Tax system — Direct taxes; Income tax and related provisions - Income tax: inherited Indonesian system with modifications; applies to all taxable income other than subject to withholding taxes (1.3) or wage income tax (1.4); supplemented by minimum income tax (1.2). - Treatment of income of legal persons: dividends, interest, royalties and rent included in taxable income, with credit for withholding tax. - Natural person rates (progressive, three brackets): - 0 - $3,368: 10% - $3,368 - $6,737: 15% - $6,737 - : 30% - Legal person rate (flat): 30% ### Depreciation and amortization rules - Business building — Straight line depreciation: - 20 years useful life at 5 percent - 10 years useful life at 10 percent - Depreciable assets — Individual depreciation: - 1-4 years useful life at 25 percent - 5-8 years useful life at 12.5 percent - 9+ years useful life at 6.25 percent - Depreciable assets — Pooling depreciation: - 1-4 years useful life at 50 percent - 5-8 years useful life at 25 percent - 9+ years useful life at 12.5 percent - Amortization of intangibles: - 1-4 years useful life at 25 percent - 5-8 years useful life at 12.5 percent - 9+ years useful life at 6.25 percent ### Deductible expenses and special taxes - Deductible expenses include: bad debt, interest, foreign exchange losses, salary and wages, contractor expenses, R&D expenses, and losses from sale/transfer of property. - Minimum income tax (1.2): - Levied on taxpayer’s total turnover for the year. - Ordinary income tax payable is credited against minimum tax payable. - Turnover excludes amounts subject to withholding taxes. - Rate: 1 percent of the total turnover. - Withholding taxes (1.3): - Withheld by payor; final except for dividends, interest, royalties and rent paid to a legal person. - Payable to residents and non-residents with permanent establishment: - dividend/ interest/ royalty: 15% - rent from land/ building: 10% - income from prizes and lotteries: 15% - construction activities: 2% - construction consulting: 4% - provision of transportation: 2.64% - petroleum drilling/ mining: 4.5% - provision of selected services: 0% - Payable to non-resident without permanent establishment: - all income: 20% - Wage income tax (1.4): - Withheld by employer. - Monthly tax credit: $10 per employee; excess credit not refunded nor carried forward. - Exempt wages: (a) wages for official duties by diplomatic staff of a foreign government’s representative office; (b) wages of a public servant of a foreign government; (c) wages of an employee of the UN or its agencies. - Resident with TIN — Monthly wage income tax rates: - $0 to $550: 10% - above $550: 30% - Non-resident: 20% - Resident without TIN: 30% - Presumptive income tax on coffee exports (1.5): - Imposed on exports of coffee beans at time of export; not applicable for coffee export after 05/31/01. - Exemption: Up to 5 kilograms of coffee beans exported in accompanied baggage by a person departing from Timor-Leste. - Rate: 5 percent of the value of coffee beans (value = arm’s length free on board value). *Source: Data provided by the Timor-Leste authorities; and Fund staff estimates.* ### 1. Selected Economic Indicators, 1999–2003 ..................................................................2 ### 1. Selected Economic Indicators, 1999–2003 ..................................................................2 ### Contents - 1. Selected Economic Indicators, 1999–2003 ..................................................................2 - 2. Selected Social Indicators ............................................................................................3 - 3. Gross Domestic Product by Sectoral Origin, 1998–2003 ............................................4 - 4. Gross Domestic Product by Expenditure, 1998–2003 .................................................5 - 5. Consumer Price Index, 2000–04 ..................................................................................6 - 6. Monetary Survey, 2000–04 ..........................................................................................7 - 7. Balance sheet of the Banking and Payments Authority, 2000–04 ...............................8 - 8. Consolidated Balance Sheet of Commercial Banks, 2000–04 .....................................9 - 9. Central Government Budget Operations (CFET) FY2000/01–2004/05 ....................10 - 10. Central Government Domestic Revenues, FY2000/01–2004/05 ...............................11 - 11. Oil/Gas Revenues, FY2000/01–2004/05....................................................................12 - 12. Central Government Expenditure Composition, FY2001/02–2004/05......................13 - 13. Public Sector Employment and Wages, FY2000/01–2004/05 ...................................14 - 14. Autonomous Agencies Operations, FY2000/01–2004/05..........................................15 - 15. Operations of the Power Authority, FY2000/01–2004/05 .........................................16 - 16. Combined Sources of Fiscal Operations, FY2000/01–FY2003/04............................17 - 17. Balance of Payments, 1999–2003 ..............................................................................18 - 18. Oil/Gas Receipts, 2000–03.........................................................................................19 - 19. Summary of Tax System ............................................................................................20 *Source: _cr04320 - 1. Selected Economic Indicators, 1999–2003* ### 20. Summary of the Exchange and Payments System .....................................................25 ### 20. Summary of the Exchange and Payments System ### Background - Background information on key issues (National Development Plan, oil/gas development, public finance, monetary developments, power sector) provided in Selected Issues and Statistical Appendix (IMF Country Report No. 03/228) issued with the 2003 Article IV consultation. ### Output and prices - GNP at current prices (in millions of U.S. dollars): 270 329 400 397 372 - GDP: 270 321 387 381 341 - Oil/gas income: 0 8 13 17 31 - Real GDP growth (percentage change): -3 5 1 5 3 -3 - Inflation (percentage change at end-period): 1/ 14 0 3 0 1 0 4 - Note: Rupiah-based CPI for Dili through 2000 and, thereafter, dollar-based CPI for Dili. ### Investment–saving balance - Gross investment 2/: 21 33 31 29 27 - Excludes investment relating to the oil/gas sector. - Gross national savings: -13 -5 -3 -4 -7 -3 -2 - External savings: 34 85 78 73 60 ### Government budget (CFET) and combined-sources fiscal operations - Government budget (CFET) revenues (in percent of GDP): ... 7.7 8.1 13.5 17.7 - Domestic revenues: ... 4.0 5.3 5.3 8.2 - Oil/gas revenues: ... 3.7 2.8 8.2 9.5 - Expenditure (in percent of GDP): ... 14.5 13.7 19.6 22.1 - Recurrent expenditure: ... 8.4 10.7 15.6 19.0 - Capital expenditure: ... 6.1 3.0 4.0 3.1 - Overall balance (in percent of GDP): ... -6.8 -5.5 -6.1 -4.4 - Combined sources fiscal operations (in millions of U.S. dollars) - Revenues: ... 8 9 15 19 - Expenditure: ... 12 21 21 10 5 9 1 (table shows sequence 12212110591) - Recurrent expenditure: ... 9 6 9 7 8 2 7 2 - Capital expenditure: ... 2 6 2 3 2 2 1 9 - Overall balance: ... -114 -111 -90 -72 - Central Government Budget Operations (CFET), FY2000/01–FY2004/05 (selected) - Revenue (In millions of U.S. dollars): 27.1 31.3 48.8 59.8 45.1 59.3 67.2 (FY columns) - Domestic revenues: 14.1 20.5 19.3 17.6 20.3 27.5 23.0 - Oil/gas revenues: 13.1 10.8 29.5 42.2 24.8 31.8 44.2 - Royalties and interest: 3.1 4.3 3.1 12.9 7.7 4.6 25.8 - Expenditure (In millions of U.S. dollars): 51.3 52.6 70.8 79.1 74.6 74.1 75.1 - Recurrent expenditure: 29.6 41.1 56.2 66.8 64.2 63.7 64.9 - Capital expenditure: 21.7 11.5 14.5 12.3 10.4 10.4 10.2 - Overall balance (In percent of GDP): -24.2 -21.3 -22.0 -19.3 -29.5 -14.8 -7.9 - Overall balance (in percent of GDP, alternative row): -6.8 -5.5 -6.1 -5.8 -8.8 -4.4 -2.4 - Memorandum: - Cumulative oil/gas savings (end-period): 3.1 7.4 10.5 22.4 18.3 15.1 41.0 - CFET cash balances (end-period): 8.9 6.3 14.8 6.0 11.3 31.0 28.0 - Non-oil overall fiscal balance (In percent of GDP): -37.3 -32.0 -51.4 -61.5 -54.3 -46.6 -52.1 ### Oil/gas revenues and receipts - Oil/gas revenues (FY series, in millions of U.S. dollars): Total oil/gas revenues 13.1 10.8 29.5 42.2 24.8 31.8 44.2 (Table 11) - Tax revenues: 9.9 6.5 26.4 29.3 17.1 27.2 18.3 - Royalties and interest: 3.1 4.3 3.1 12.9 7.7 4.6 25.8 - Oil/gas receipts (2000–2003) - Total oil/gas receipts (2000 2001 2002 2003): 8.1 12.5 16.5 31.2 - Royalties (first tranche petroleum): 3.1 4.2 0.0 4.3 - Tax revenues: 5.0 8.2 16.4 26.8 - Total oil/gas receipts (as percent of GDP): 2.5 3.2 4.3 9.1 - Royalties (percent of GDP): 1.0 1.1 0.0 1.3 - Tax revenues (percent of GDP): 1.5 2.1 4.3 7.9 - Memorandum: - Oil/gas revenues (1999–2003): 0 8 13 17 31 - Gross foreign assets (end-period): 0 16 24 44 61 - O/w: Oil/gas revenue savings: 0 37 71 1 ### Money, credit, and banking sector - Broad money (end-period, in millions of U.S. dollars): 48 61 31 42 1 (table shows sequence 486131421) - Net domestic assets (end-period): 47 -4 -4 -9 -11 - Monetary survey (selected, in millions of U.S. dollars; end of period) - Net foreign assets (2000 Dec to 2003 Mar entries): 33.8 65.4 72.9 68.9 77.3 89.9 92.8 99.7 103.1 108.3 133.7 - Cash holdings (selected): 6.3 11.7 12.1 7.7 12.4 18.1 15.1 10.5 15.3 19.0 28.6 - Claims on foreign banks (selected): 27.5 61.2 68.8 65.0 68.1 75.3 81.9 94.1 90.7 122.6 125.6 - Net domestic assets (selected): -13.8 -14.3 -17.7 -18.5 -22.5 -35.3 -38.4 -41.9 -37.6 -36.0 -58.7 - Claims on government (net): -19.0 -21.1 -22.3 -19.2 -20.9 -33.7 -36.3 -41.5 -28.3 -49.7 -74.3 - Loans and advances to private sector: 0.3 3.0 3.5 4.4 4.5 5.1 6.1 7.8 12.6 22.1 32.4 - Broad money 2/: 20.0 51.1 55.2 50.4 54.8 54.6 54.4 57.7 65.5 72.3 75.0 - Demand deposits: 19.3 36.9 40.1 36.1 39.6 39.1 37.5 39.2 43.1 40.1 44.0 - Saving deposits: 0.0 8.2 9.7 8.4 9.4 10.2 11.7 13.7 16.6 22.6 25.1 - Time deposits: 0.7 6.0 5.4 5.9 5.8 5.3 5.2 4.9 5.8 9.6 6.0 - Bank loan/broad money ratio (memorandum): 1.5 5.9 6.3 8.6 8.2 9.4 11.1 13.5 19.2 30.6 43.1 - Banking system composition: Banking and Payments Authority (BPA), three commercial banks, and one microfinance institution. - Note: Excludes currency in circulation due to dollarization; figures after 1999 exclude currency holdings by the public. ### Balance sheet of the Banking and Payments Authority (selected; in millions of U.S. dollars; end of period) - Net foreign assets (memorandum series): 16.0 23.7 28.2 26.7 33.2 43.5 46.3 51.4 42.3 61.3 86.8 - Claims on central banks (selected): 14.7 18.8 19.5 21.0 24.8 30.5 34.1 43.6 32.1 54.4 66.4 - Reserve Bank of Australia — Timor Sea account (selected): 3.1 7.4 7.4 7.4 7.4 7.5 10.5 10.5 10.6 10.6 13.9 - Reserve Bank of Australia — Current accounts with RBA (selected): 11.6 11.4 12.2 13.5 17.3 23.0 23.6 33.1 21.6 43.9 52.5 - Net domestic assets (selected): -16.0 -22.7 -25.7 -23.1 -27.8 -39.1 -42.3 -46.6 -34.8 -55.0 -80.9 - Government (net position) breakdown: Budget and Timor Sea account components included (e.g., Timor Sea account -3.1 -7.4 -7.4 -7.4 -7.4 -7.5 -10.5 -10.5 -10.6 -10.6 -13.9) - Deposit liabilities (percent of GDP or series): financial institutions and deposit compositions reported across periods. ### Consolidated balance sheet of financial institutions (2000–04; selected) - Net foreign assets (memorandum): 17.8 41.7 44.7 42.2 44.1 46.4 46.5 48.3 60.8 47.0 47.0 - Net domestic assets (memorandum): 5.2 12.9 12.3 10.6 11.6 10.7 9.7 11.5 6.2 28.8 30.6 - Deposit liabilities (memorandum): 20.0 51.1 55.2 50.4 54.8 54.6 54.4 57.7 65.5 72.3 75.0 - Demand deposits: 19.3 36.9 40.1 36.1 39.6 39.1 37.5 39.2 43.1 40.1 44.0 - Interest rate ranges (annual rates as of March 2004): deposit and lending ranges provided (e.g., bank loans 14.0-19.0; on-lending under SEP 10.0). ### External sector and balance of payments (1999–2003) - Current account excl. official transfers (in millions of U.S. dollars): -92 -279 -309 -292 -230 - Current account incl. official transfers: 648 544 444 443 - Trade balance (in millions of U.S. dollars): -67 -235 -264 -245 -195 - Merchandise exports 6/7/: 5 2 5 4 6 7 (table shows 525467) - Merchandise imports 6/: -119 -240 -268 -251 -203 - Services (net): -25 -48 -49 -48 -40 - Income (net): 0 3 5 16 - O/w: Oil/gas royalty and interest: 0 3 4 0 4 - Current transfers (net): 98 32 73 63 33 36 2 73 (table shows 98327363336273 sequence) - O/w: Oil/gas tax revenues: 0 5 8 16 27 - International assistance: 4 33 15 34 73 14 2 40 - Capital and financial accounts: -3 -54 -61 -36 -16 - Official capital transfers: 0 7 17 47 15 8 - Overall balance (in millions of U.S. dollars): 0 1 6 8 20 18 - Current account excl. official transfers (In percent of GDP): -34 -87 -80 -77 -67 - Current account incl. official transfers (In percent of GDP): 215 141 121 213 - Trade balance (In percent of GDP): -25 -73 -68 -64 -57 - Memorandum items: - Oil/gas revenues: 0 8 13 17 31 - Gross foreign assets (end-period): 0 16 24 44 61 - O/w: Oil/gas revenue savings: 0 37 71 1 ### Sectoral composition of GDP and expenditure (1998–2003) - Sectoral shares at current market prices and at constant 2000 market prices detailed across Agriculture, Mining, Manufacturing, Construction, Trade, Transport, Finance, Public admin. and defense, Private services. - Total GDP at current prices (selected years): 390.4 270.1 321.2 387.4 380.7 341.2 - Consumption and investment shares, and gross national savings and external savings series provided across 1998–2003. ### Consumer Price Index (Dili), 2000–2004 (April 2000 = 100.0) - Index monthly series and month-to-month and year-on-year percentage changes for 2000–2004 provided. - Annual average indices: 2000 = 100.0; 2001 = 113.5; 2002 = 118.9; 2003 = 127.4; 2004 (partial) Jan–Apr = 130.0 130.1 130.3 130.9 - Year-on-year percentage change 2003 annual average: 7.2 ### Public sector employment and wages (FY2000/01–FY2004/05) - Total government employees (selected FYs): 11,164 10,012 14,817 12,569 16,387 13,170 17,150 14,300 17,175 - Public sector pay-scale: average wage for each grade in U.S. dollars (grades L1–L7) reported; pay-scale not changed since FY2000/01. ### Operations of the Power Authority and Autonomous Agencies - Power Authority (FY series) - Total retained revenues (in percent of GDP): 1.4 4.4 4.9 6.9 5.9 5.3 8.4 - Total expenditures (in percent of GDP): 8.8 9.1 12.6 13.5 13.5 12.7 13.6 - Overall balance (in percent of GDP): -7.4 -4.7 -7.7 -6.6 -7.6 -7.4 -5.3 - Financing and transfers from the budget series provided. - Combined sources fiscal operations (Table 16) and detailed CFET vs Non-CFET breakdowns provided for FY2000/01–FY2003/04 including revenues, total expenditure, recurrent and capital expenditure, overall balance, and financing. ### Revenue collection and tax system summary - Revenue collection and tax composition series reported (Tables 10, 11, 19), including: - Total domestic revenue (in percent of GDP series): 14.1 20.5 19.3 17.6 20.3 27.5 23.0 - Tax revenue (in percent of GDP series): 12.2 18.1 17.0 14.9 17.2 23.0 19.0 - Taxes collected at the border (memorandum): 9.9 10.7 9.8 8.7 10.0 14.4 11.5 (In percent of GDP) 2.8 2.8 2.7 2.6 3.0 4.3 3.5 - Table 19 indicates a Summary of Tax System (as of March 2004) with structure headings (Tax; Nature of Tax; Exemptions and Deductions; Rates), content not reproduced in this extract. *Source: Data provided by the Timor-Leste authorities; and Fund staff estimates.* ### 1. Direct Taxes 1.1. Income tax ### _cr04320 - 1. Direct Taxes 1.1. Income tax ### Income tax: scope and structure - Timor-Leste has inherited the Indonesian income tax system with some modifications. - The income tax applies to all taxable income other than that subject to withholding taxes (1.3) or wage income tax (1.4), and is supplemented by the minimum income tax (1.2). - In the case of a legal person, income from dividends, interest, royalties and rent is included in the taxable income, with a credit for withholding tax. - Progressive rates with three brackets are applicable in the case of a natural person, and a flat rate is applicable in the case of a legal person. ### Depreciation - Business building - Straight line depreciation: - 20 years useful life at 5 percent - 10 years useful life at 10 percent - Depreciable assets: - Individual depreciation: - 1-4 years useful life at 25 percent - 5-8 years useful life at 12.5 percent - 9+ years useful life at 6.25 percent - Pooling depreciation: - 1-4 years useful life at 50 percent - 5-8 years useful life at 25 percent - 9+ years useful life at 12.5 percent - Amortization of intangibles: - 1-4 years useful life at 25 percent - 5-8 years useful life at 12.5 percent - 9+ years useful life at 6.25 percent ### Deductible expenses - Deductible expenses include: bad debt, interest, foreign exchange losses, salary and wages, contractor expenses, R&D expenses, and losses from sale/transfer of property. ### Natural person: income brackets and tax rates - 0 - $3,368: 10% - $3,368 - $6,737: 15% - $6,737 - : 30% ### Legal person: income tax rate - 30% ### 1.2. Minimum income tax - Minimum income tax is levied on the taxpayer’s total turnover for the year. - The ordinary income tax payable is credited against the minimum tax payable for the year. - The taxpayer’s total turnover does not include any amount derived by the taxpayer that is subject to the withholding taxes. - 1 percent of the total turnover ### 1.3. Withholding taxes - Income earned from designated sources (including dividend, interest, royalty, and rent) is subject to withholding tax at a variety of rates. - The tax is withheld by a person making payments to the recipient of the income. - The withholding taxes are final, except for dividends, interest, royalties and rent paid to a legal person. - Tax rates vary according to the source of income. Payable to residents and non-residents with permanent establishment: - dividend/ interest/ royalty: 15% - rent from land/ building: 10% - income from prizes and lotteries: 15% - construction activities: 2% - construction consulting: 4% - provision of transportation: 2.64% - petroleum drilling/ mining: 4.5% - provision of selected services: 0% - Payable to non-resident without permanent establishment: - all income: 20% ### 1.4. Wage income tax - The wage income tax is withheld by the employer. - Each employee is allowed a monthly tax credit of $10 against the wage income tax payable for the month. Excess credit is neither refunded nor carried forward. - Exempt wages include: - (a) wages received for official duties by diplomatic staff of a foreign government’s representative office - (b) wages of a public servant of a foreign government - (c) wages of an employee of the UN or its agencies - Resident with Tax Identification Number (TIN) Monthly wage income — Tax rate: - $0 to $550: 10% - above $550: 30% - Non-resident: 20% - Resident without TIN: 30% ### 1.5. Presumptive income tax on coffee exports - Imposed on exports of coffee beans, whether processed or unprocessed, at the time of export. Not applicable for coffee export after 05/31/01 - Up to 5 kilograms of coffee beans exported in accompanied baggage by a person departing from Timor-Leste are exempt. - 5 percent of the value of coffee beans. The value of the coffee beans is the arm’s length free on board value of the beans. *Source: Information provided by the Timor-Leste authorities.* --- _Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2004/_cr04320.pdf_