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The Ministry of Finance and the Public Service has announced that it is reviewing the tax waiver/incentive regime, to formulate a new Tax Waiver/Incentive Policy and Strategy that is in line with the country’s developmental goals.
The new Tax Waiver/Incentive Policy and Strategy will be formulated by the end of December, but the Ministry issued a release Friday (August 5) which stated:
Pending consideration and adoption of the new Tax Waiver/Incentive Policy and Strategy, the Government has approved the following:
General Waiver Conditions
1. The GOJ has approved a freeze of, and reduction in all discretionary waivers that may be granted by the Minister of Finance and the Public Service (MFPS) effective August 1, 2010. The freeze means that no new discretionary waiver categories will be considered or approved between August 1, 2010 and the date of adoption of a new Tax Waiver/Incentive Policy and Strategy. The reduction in all discretionary waivers granted by the MFPS means that the consideration of discretionary waiver applications between August 1, 2010 and the date of adoption of a new Tax Waiver/Incentive Policy and Strategy will be done within the context of achieving a significant reduction in the total value of waivers granted.
2. The GOJ has approved a freeze on the promotion/tabling of new statutory waivers, effective August 1, 2010. This means that no new statutory waivers will be submitted to the Houses of Parliament for consideration between August 1, 2010 and the date of adoption of a new Tax Waiver/Incentive Policy and Strategy.
3. All discretionary waivers granted will be published on the Ministry of Finance and the PublicService’s website on a monthly basis.The publication will indicate details with respect to the beneficiary entity and sector, description of the good and/or service subject to the tax waiver and the amount of tax approved to be waived.
Specific Waiver Conditions1. Effective August 1, 2010, the regime for approval of motor vehicle concessions to farms/farmers has been modified such that only farms or farmers registered with the Rural Agricultural Development Authority (RADA) can apply for concessions once every five years. The number of motor vehicles accessible under this facility will be determined by a combination of farm size and production.
2. Effective August 1, 2010 the duty concession to the Rental Vehicle Industry (U-Drive) has been frozen. This means that no applications for duty concessions applicable to the Rental Vehicle Industry (U-Drive) will be considered or approved between August 1, 2010 and the date of adoption of a new Tax Waiver Policy and Strategy.
3. The waiver of GCT payments under the Modernization of Industry Programme will cease effective March 31, 2011. This means that effective April 1, 2011 the provisions of the GCT Act relating to capital equipment under the Modernization of Industry Programme will apply. There will be no renewal of the waiver of GCT payments under the Modernization of Industry Programme. Any concessionary treatment for modernization of industry will be addressed in the new Tax Waiver/Incentive Policy and Strategy.