- Seychelles Lifts Import Duties On Certain Building Materials 11th January 2018
Effective January 1, 2018, import duty was removed in the Seychelles on dietary supplements, corrugated iron sheets, and various other building materials, including panels, tiles, and other similar materials.
VAT will still apply on the aforementioned items, at a 15 percent rate, the tax agency said.
The changes were included in Statutory Instrument 68 of 2017, Customs Management (Tariff and Classification of Goods) (Amendment) No 2 Regulations, 2017.
- Seychelles Approves Tax Law Changes 2nd January 2018
At an extraordinary meeting of the Seychelles Cabinet in December, a number of legal and tax policy proposals were approved, continuing the jurisdiction’s progress in reforming its tax regime and bolstering its economy.
According to a Ministry of Finance statement released following the meeting: “Cabinet approved policies relating to the Progressive Income Tax Law. The aim of these policies are to simplify income tax collection. Cabinet also approved the amendment to the Excise Tax Bill. The amendments would harmonize the categories of business and persons entitled to fuel concessions under the Excise Tax Act 2009.”
Administrative changes were also approved to the Seychelles Revenue Commission Act and the Customs Management Bill to allow for the renaming of certain posts, and to allow for the creation of a Revenue Commission Board.
Then, on December 13, the Executive Board of the International Monetary Fund (IMF) approved a new Policy Coordination Instrument (PCI) for Seychelles. The three-year arrangement with the IMF will allow the Government of the Seychelles to receive intensive support with regard to developing and implementing pro-growth economic policies.
In a previous review of the economy, concluded in October 2017, the IMF had observed that while the Seychelles has made “remarkable progress” on strengthening its economy and finances, it “…still faces vulnerabilities and pressures, as a small island economy in a challenging global economic environment.”
- Seychelles Overhauls Tax Settings In Recent 2018 Budget 22nd November 2017
The Seychelles Budget included numerous proposals to change the territory’s tax settings, including new corporate tax reliefs and the settings for a progressive personal income tax regime. The Government said its proposals for a progressive income tax will mark the third phase of reform efforts that began in April 2016, with the introduction of a higher personal income tax exemption, for those earning less than SCR8,555 (USD618) a month. Under the new changes, the threshold will remain the same, but income up to SCR10,000 will be subject to a 15 percent rate; income up to SCR83,333 will be subject to a 20 percent rate, and a 30 percent rate will be levied on income above that threshold. Foreign individuals will not benefit from the tax exempt threshold. The threshold will be applicable on a monthly basis, in a move said to be to reduce the tax compliance burden. The Government has also proposed an alternative for small businesses from being taxed under the business tax regime. Through such, they can be subject instead to a flat fee of SCR3,000, for businesses with a turnover of not more than SCR500,000; or a flat percentage of three percent for those businesses with turnover between SCR500,000 and SCR25m. Those with a turnover greater than this will not be eligible. It was noted alongside the proposals that Seychelles has offered a presumptive tax with a 1.5 percent rate since 2013. In the Budget, it is proposed that the following businesses will no longer have five percent tax deducted at source (DAS): building contractors, maintenance contractors, mechanics, hirers or operators of plant and equipment, or hirers of buses. Amendments are proposed to the Business Tax Act to clarify, first, that Seychelles will have a territorial tax regime and, second, tax on depreciable assets will be limited to the original cost of the asset. From 2019, the following tax concessions for the tourism sector will be repealed: accelerated depreciation and the 200 percent allowable deduction for marketing and promotion costs. Instead the Government is considering offering a 200 percent allowable deduction for employing a qualified Seychellois graduate holding a Certificate, Diploma, or Degree or higher from an institution endorsed by Seychelles Qualification Authority (SQA); a 150 percent deduction for emoluments paid by an employer to a Post-Secondary or Tertiary, who is in full-time education and in part-time employment, and 150 percent for a business paying for training end …