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

Table 7-5 (continued)
Sheet 4 of 4
Country Investment Tax Credit (ITC)
Angola f None indicated None (employment subsidy
instead)
Botswana None 200% deduction for cost of
approved training for citizen
employees
Excess Deductions for
Employment and Training Export Tax Incentives
No free trade zones; exporters exempt from excise tax
No export zones or export incentives other than rebate on
raw materials sourced outside SACU for exports outside
SACU
Dr Congo None indicated None indicated No free trade zones; approved companies exempt from
export duties and taxes; see initial allowance (previous
page)
Lesotho None indicated 125% for training or tertiary
education costs for
manufacturing companies
Malawi None indicated Additional 50% of training cost
for employee to earn degree,
diploma or certificate
Mauritius 10% on investment by
companies in certain
categories other than tax
incentive companies, such
that tax payable is not less
than 15%
Mozambique a 5%, 10%, 15%, 20% or 30% ITC
depending on location, sector,
and size of project) on eligible
fixed assets; add 3% for
tourism; credit c/fwd expires
after year 5
Namibia None indicated Manufacturers qualify for
additional deduction on
training expenses [amount?],
and 25% additional deduction
for production line wages
Duty free imports for manufacture of goods to be
exported outside SACU
Exporters may have EPZ or bonded status; zero
corporate tax and dividend tax; zero import duty and
indirect tax inputs; allowance of 12.5% of gross export
sales; additional 25% allowance on transport costs
None indicated Free trade zones; 15% company tax rate. Other exporters
zero duty and VAT on scheduled inputs; double
deduction of export marketing costs; tax credit of 15-40%
on export volume such that tax not less than 15%
None indicated Industrial Free Zones function as EPZ except labor laws
apply; also 60% reduction on company tax for 10 years
EPZ companies exempt from all taxes and duties;
additional deduction of 25% to 75% on costs for export
promotion and marketing; 80% allowance on taxable
income from export of manufactured goods (excl. fish
and meat)
Seychelles None indicated None indicated 15% tax rate for export companies under IPA; zero tax on
offshore companies operating in international trade
zones \b
South Africa None indicated Additional deduction up to
R50,000 per employee under
approved learnership
programs.
Swaziland None indicated 200% deduction for cost of
approved training expenses
(1) Companies in Ind. Dev. Zones zero duty and VAT on
inputs. (2) Automotive exports (MIDP) obtain import
duty credits as function of domestic content of exports.
(3) Other companies that manufacture or process exports
get rebate or drawback of duty on some imported inputs.
(1) Free trade zones; (2) duty credit certificate scheme
for textile and clothing exporters
Tanzania None indicated None indicated (1) 10 -20 year holiday for EPZ companies, followed by
25% tax rate (details depend on location); holiday
includes withholding tax; outside EPZ, duty drawback
scheme applies
Zambia c None indicated None indicated EPZ Act implemented 2003 provides; provides for standalone
EPZ sites; in addition to standard EPZ tax benefits,
also provides full exemption from corporate tax,
withholding tax, capital gains tax and excise duty.
Zimbabwe d None indicated Double tax deduction on wages
and salaries for additional
employees in manufacturing
[SADC review]
Notes for Table 7-5 are on the next page.
EPZ at industrial parks or stand-alone: 5 year tax holiday
then 15% rate; no w/holding tax on dividends etc.; tax
reduced by 10 percentage pts for manufacturer exporting
> 50% of output; 200% deduction for export development
market costs.