An Evaluation of the System of Taxing Capital Gains from Shares in Cameroon in Light of Double Taxation of Corporate Profits

The quest for additional revenue yield has led to fundamental changes in the Cameroonian tax system, specifically in the method of taxing capital gains on transfer of shares. Though aimed at improving the system from an equitable angle, these changes may give rise to theoretical controversy given the method of taxing these gains. In particular, the trigger of the capital gains tax (CGT) and the method of taxing corporate profits are potential elements to be raised against the recent increase of CGT rate on shares and the deletion of the incentives initially granted. This paper argues the inappropriateness of these changes through an evaluation of its rationale. Notwithstanding the primacy of the equity criterion, the theoretical basis for taxing these gains may however dictate departure from such principle in order to achieve the objective of increasing the revenue yield.