In Tunisia, all VAT-registered businesses must calculate…
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In Tunisia, all VAT-registered businesses must calculate the FODEC (Competitiveness Development Fund) when required by regulations. The method you provided (FODEC added to the VAT base) is indeed the one used by compliant companies. Businesses that do not apply it risk a tax audit.
Businesses that apply the FODEC
Large industrial companies: The FODEC is mandatory for most manufactured products. Industrial and commercial companies must include it in their invoices.
Tunisian SMEs: Local business management software (e.g., TASSARUF TIJARI) automatically integrates the FODEC + VAT calculation to ensure compliance.
Service providers: Since the 2026 Finance Law, the mandatory electronic invoicing (El Fatoora/TTN) also includes services, with the FODEC configurable line by line.
Exporters: Even if some transactions are exempt from VAT, the FODEC (Tax on Exports) may still apply depending on the nature of the product.
Businesses not subject to the FODEC
Exempt sectors: Essential products (bread, milk, basic medicines) are exempt from VAT and often from the FODEC.
Non-taxable micro-enterprises: Small businesses below the revenue threshold may be exempt from VAT and therefore from the FODEC.
Sales outside the scope of the FODEC: Certain specific transactions (e.g., direct exports or traditional agricultural activities) are not subject to the FODEC.
Practical Example (Your Case)
Price excluding VAT: 100 TND
FODEC (1%): 1 TND
VAT Base: 101 TND
VAT (19%): 19.19 TND
Price including VAT: 120.19 TND
This calculation complies with Tunisian regulations. Companies that do not apply it (for example, by calculating VAT only on 100 TND) are committing a tax error.
Key Points to Remember
FODEC is a mandatory business tax on many goods and services.
It is added to the VAT base, slightly increasing the amount of VAT collected.
Approved invoicing software (El Fatoora, TASSARUF, etc.) ensures automatic compliance.
Do not apply FODEC
Businesses that apply the FODEC
Large industrial companies: The FODEC is mandatory for most manufactured products. Industrial and commercial companies must include it in their invoices.
Tunisian SMEs: Local business management software (e.g., TASSARUF TIJARI) automatically integrates the FODEC + VAT calculation to ensure compliance.
Service providers: Since the 2026 Finance Law, the mandatory electronic invoicing (El Fatoora/TTN) also includes services, with the FODEC configurable line by line.
Exporters: Even if some transactions are exempt from VAT, the FODEC (Tax on Exports) may still apply depending on the nature of the product.
Businesses not subject to the FODEC
Exempt sectors: Essential products (bread, milk, basic medicines) are exempt from VAT and often from the FODEC.
Non-taxable micro-enterprises: Small businesses below the revenue threshold may be exempt from VAT and therefore from the FODEC.
Sales outside the scope of the FODEC: Certain specific transactions (e.g., direct exports or traditional agricultural activities) are not subject to the FODEC.
Practical Example (Your Case)
Price excluding VAT: 100 TND
FODEC (1%): 1 TND
VAT Base: 101 TND
VAT (19%): 19.19 TND
Price including VAT: 120.19 TND
This calculation complies with Tunisian regulations. Companies that do not apply it (for example, by calculating VAT only on 100 TND) are committing a tax error.
Key Points to Remember
FODEC is a mandatory business tax on many goods and services.
It is added to the VAT base, slightly increasing the amount of VAT collected.
Approved invoicing software (El Fatoora, TASSARUF, etc.) ensures automatic compliance.
Do not apply FODEC
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