The revised finance law marks the first major budgetary adjustment under President Romuald Wadagni’s administration. It prioritizes equipping newly created or restructured ministries with necessary resources while significantly boosting investments in social and productive sectors.

Economic growth remains steady at 7.5%, aligning with the country’s strong performance over the past decade. The overall budget deficit is set at 487 billion CFA francs, representing 3.1% of GDP—a level the government asserts is consistent with Benin’s commitments within the West African Economic and Monetary Union (WAEMU).

Capital expenditures rise to 1,572 billion CFA francs in committed authorizations, an 8.5% increase from the initial budget. Ordinary ministry expenses total 1,777 billion CFA francs, while the state’s paid employment ceiling remains unchanged at 102,740 full-time equivalents.

Key social measures in the law

The legislation places strong emphasis on improving purchasing power and access to essential services. It introduces universal free secondary education for girls, expands electricity and potable water connections to health centers, and guarantees free emergency care without prepayment. Additional provisions include strengthening local social safety nets, supporting vulnerable early childhood, and allocating 90 billion CFA francs in agricultural subsidies. Special attention is directed toward children living on the streets, particularly in northern and border regions.

Fiscal reforms modernizing taxation

The law introduces several structural tax measures. One of the most significant changes targets undistributed profits: companies that fail to reinvest profits within three years of realization will face taxation. A reduced 7.5% rate applies to voluntarily regularized situations before December 31, 2026, with standard rates and penalties applying afterward.

Digital platforms—including hosting services, online sales, and money transfers—now fall under source-based withholding tax obligations for operators. Capital gains from the sale of shares in Beninese companies become taxable regardless of the seller’s residence. Tax audit durations for companies with annual turnover below two billion CFA francs are shortened from three to two months, and the legal validity of digital tax notices and procedural documents is firmly established.

Only one amendment was adopted during committee review, proposed by Deputy Gérard Benoshi to enhance the coherence of digitalization provisions. The Ministry of Economy and Finance endorsed the change.

Budgetary cleanup and new allocation rules

The law streamlines special Treasury allocation accounts by abolishing three funds: the Modernization Fund for Financial Regies, the Arts and Culture Development Fund, and the Sports Development Fund. Their remaining balances are transferred to the general budget.

The Disaster Prevention and Management account has been renamed Prevention, Disaster Management and Vulnerability Reduction and will be funded in 2026 by 56.2% of mobile telephony royalties. Criteria for state financial support to local authorities now include climate adaptation and mitigation measures.

Rapid parliamentary debate and economic council feedback

The Economic and Social Council, consulted per constitutional requirements, issued a favorable opinion alongside fourteen recommendations. It calls for a plan to reduce the deficit below 3% of GDP by 2027-2029, semiannual public debt sustainability reports, geolocated digital traceability for agricultural subsidies, and semiannual budget execution reviews involving the Council and the Audit Court.

Parliamentary debate was concise, with both the Republican Bloc and the Progressive Union for Renewal limiting their interventions to fifteen minutes each. Lawmakers from both sides broadly supported the text, commending continuity with the economic trajectory initiated under President Patrice Talon’s leadership. They emphasized the need for rigorous spending execution and enhanced monitoring of social measures.

The Finance Committee, which examined the bill in detail, submitted four recommendations to the executive: intensify tracking of street children with priority given to northern and border zones, clarify and publicize the emergency care program, extend school social measures to university scholarships, and ensure equitable distribution of investments across all regions.