Afghanistan Tax Rates 2026: Income Tax, Corporate Tax and Historical Rates
This page summarizes currently announced Afghanistan income-tax changes, links to official tax-law resources, and preserves the earlier 2014-2017 rate information for historical reference. Tax rules can be amended through laws, regulations, decrees and official decisions, so taxpayers should confirm the applicable treatment with the Afghanistan Revenue Department before filing or making a material transaction.
Current Afghanistan tax changes announced in 2026
Official government announcements dated 12 July 2026 reported new tax reductions intended to support investment and private-sector activity. The announcements state that the income-tax rate for legal persons, including companies and hospitals, was reduced from 20% to 10%, and that the annual income-tax exemption threshold for natural persons was increased from AFN 60,000 to AFN 120,000.
Official Afghanistan tax laws and guidance
The Afghanistan Revenue Department (ARD), under the Ministry of Finance, publishes the Income Tax Law, Tax Administration Law, VAT law and regulation, tax guidelines, forms and taxpayer guidance. These official resources should take priority over older summaries when determining current liability.
Afghanistan individual income tax
For current planning, the most recent official announcement located for this update states that annual income of natural persons up to AFN 120,000 is exempt, while annual income between AFN 120,000 and AFN 1.2 million is taxed at 10%. Taxpayers above that band, or with multiple categories of income, should confirm the applicable computation under the operative Income Tax Law and current ARD instructions.
| Annual income | Current announced treatment |
|---|---|
| Up to AFN 120,000 | Exempt from income tax under the July 2026 announced relief. |
| AFN 120,000 to AFN 1,200,000 | 10% income tax, according to the official government announcement. |
| Above AFN 1,200,000 | Check the operative law and current ARD instructions for the relevant period; the July 2026 announcement cited here does not set out the full treatment above this level. |
Afghanistan corporate income tax
The Ministry of Finance/ARD tax-reduction announcement states that the income-tax rate for legal persons, including companies and hospitals, was reduced from 20% to 10%. Businesses should verify the tax period from which the reduced rate applies, the taxable base, allowable deductions, sector-specific rules, fixed taxes, withholding obligations and filing requirements with ARD.
Residence rules and taxable income
Historically, Afghanistan's income-tax rules treated an individual as resident where, among other tests, the person had a principal home in Afghanistan, was present for an aggregate period meeting the statutory residence test, or was an Afghan government employee or official assigned to duties. Because residence rules affect the scope of taxable income, the current statutory wording should be checked directly in the Income Tax Law before relying on an older summary.
Employment compensation
Employment income has traditionally included salary, wages, bonuses, allowances and other cash or in-kind compensation. Exemptions and valuation rules for benefits can change, so older fixed-dollar allowances previously shown on this page are not carried forward as current limits unless confirmed by current official guidance.
Withholding tax, capital gains, VAT and other taxes
Afghanistan's tax system includes withholding obligations and rules affecting rental services, contractors, wages and certain investment payments. The Ministry of Finance currently publishes dedicated guides for rental withholding, business receipts tax, wage withholding and corporations/limited-liability companies. Taxpayers should use the latest ARD or Ministry of Finance guide applicable to the payment type.
Transfers of movable and immovable property were reported in the July 2026 tax-reduction announcement as subject to a reduced 0.5% transfer tax, down from 1%. Capital gains and other gains may also interact with income-tax provisions; the transaction-specific statutory rule should be checked before calculation.
Afghanistan also has a Value Added Tax Law and VAT Regulation published by ARD. Registration, commencement, scope, rates and compliance requirements should be verified from the current ARD VAT materials rather than inferred from the older "sales tax" statement that appeared on this page.
Tax Identification Number, returns and payment
Persons and businesses subject to Afghanistan tax obligations may need a Tax Identification Number (TIN), returns, records and payment documentation. ARD publishes current guidance on TIN registration, accounting and recordkeeping, deductible expenses, taxable and non-taxable income, assessments and other compliance topics.
Do not rely on historical filing dates reproduced in older versions of this article without checking current ARD rules. Fiscal calendars, filing procedures, forms, electronic-payment arrangements, administrative rules and deadline relief can change.
Historical Afghanistan income tax rates: 2014-2017
The table below is retained because this page historically covered earlier Afghanistan tax years. It is not a current 2026 rate table and should be used only when researching a historical period.
| Historical annual taxable income (AFN) | Historical rate shown on this page |
|---|---|
| 0 to 60,000 | 0% |
| 60,001 to 150,000 | 2% |
| 150,001 to 1,200,000 | AFN 1,800 plus 10% of the amount over AFN 150,000 (historical formulation) |
| Over 1,200,000 | AFN 106,800 plus 20% of the amount over AFN 1,200,000 (historical formulation) |
Historical material on residence, investment income, business receipts tax and filing procedures has been condensed where its continued accuracy could not be established from current official sources. The current-law links above should be used for present-day compliance.