Effectiveness and Economic Impact of Tax Incentives in the SADC ...

Table 7-5 (continued)
Sheet 2 of 4
Country
Tax Holiday (temporary
reduction/exemption/rebate)
Angola f (1) 50% tax reduction for 3-5 years for new
industries and commercial activities in key
areas
Botswana 5 years typically with Development
Approval Order (DAO)
DR Congo (1) 3 -5 year exemption for new companies;
(2) Discretionary exemptions under
contractual regime
Exempt Companies (0%
rate) Differential Tax Rates
None indicated 20% for agriculture, forestry, livestock; up
to 70% tax on income from oil production
None (1) 15% (5%+10% additional company tax)
for mfg; (2) 15% for IFSCs; (3) for mining
companies with profit rate > 33.3% tax rate
> 25% based on formula
None indicated None indicated
Lesotho None indicated None indicated 15% for manufacturing and farming
Malawi Priority industries have option of 5-10 year
tax holiday (depending on size of
investment) or fixed 15% tax rate
Mauritius 10 years for foreign income of certified
regional headquarters; holiday to June 2008
(or 15% tax rate) for investment under ICT
scheme
Mozambique a (1) For agriculture 80% reduction until 2012;
(2) for IFZ operations 60% reduction up to
10 yrs; (3) for mining and petroleum 25%
reduction for 5 and 8 years; (4) exceptional
incentives for investments > $500 million
for up to 10 years
Namibia 50% abatement for 5 years, phasing out
over following 10 years for registered
manufacturers
EPZ companies 21% life insurance; 35% branch of foreign
company
Companies in freeport
zone; financial services
company under Global
Business License; sugar
cane cultivation on new
land.
None indicated 10% for agriculture
Seychelles None indicated (Offshore) companies in
International Trade Zone b
South Africa 6 year for export companies in Industrial
Development Zones ended in 1999
Swaziland (1) 5-year holiday new export mfg
industry*; (2) Development Approval
Order gives 10 year holidays at 10% tax rate
+ exemption from dividend w/holding. *
Note: Tax applies to excess income, as per
formula.
Tanzania (1) 10 -20 year holiday for EPZ companies,
followed by 25% tax rate (details depend on
location); (2) Full remission until 2008 in
Dodoma Capital Development Area
Zambia c (1) Special agreements for tourism in
Livingstone; (2) 5 year exemption for some
small scale industry; (3) one-seventh
reduction for rural enterprises for 5 years.
Zimbabwe d (1) 5-yr holiday + 5 yrs at 15% for
qualifying investors; (2) 5 yrs for EPZ
companies, followed by 15% rate; (3) 5 yrs
each at 0%, 15% and 20% for BOOT
arrangement and tourism facility in tourist
zone:
15% for tax incentive companies in a variety
of categories.
EPZ companies 55% diamond mining; 37.5% other mining;
petroleum 35% + variable Additional
Profits Tax
15% rate for export companies under IPA
and companies in special growth areas;
25% and 35% brackets for small businesses
None indicated 15% rate for small manufacturers (taxable
income < R150,000; turnover < R5 million)
None indicated 10% Development Approval Order
None indicated None indicated
(1) EPZ companies; (2)
Activities deemed by the
Minister "to assist in the
development of the
Republic" can be wholly or
partially exempt.
15% for farming, fertilizer, non-traditional
exports; 25% for mining; 30% for listed
companies; 45% on excess income in
banking.
None indicated 15% for licensed investor (after 5 yr
holiday) or new infra. project in growth
point area; 25% for mining; 20% for export
manufacturing or processing and some
tourist facilities; 10% for new
manufacturing in growth point area.