Corporate Income Tax Headline Rate of 12.5% (possible effective rate of 7.5% with the approval of additional tax credits) – Corporate Income tax is imposed on the chargeable income of a body corporates, for example limited liability companies. However, as an SEZ, an incentive is to receive a lower rate for corporate income tax of 12.5%. Also, with approval of additional tax credits, an even lower rate could be received of 7.5%.
Relief from Income Tax on Rental Income – Income tax is a charge imposed on entities based on the income or profits. The Multi-Purpose Developer or an Occupant is exempt from the payment of the income tax on profits derived from rentals of property in the Zone, except for rentals where the landlord (whether the Developer or an Occupant) and tenant are connected persons within the meaning of the Income Tax Act.
GCT Relief – GCT is a value added tax (VAT) enacted on the supply of goods and services within Jamaica. As a benefit to the Developer or Occupant, goods and services entering for use in the Zone, including electricity and telephone services supplied to the zone, are subjected to GCT at a rate of 0% as opposed to 15%.
Employment Tax Credit – This is an income tax credit which is granted to eligible employers. Employers who are involved in a trade, profession or vocation may claim this tax credit against income tax payable based on specified payments (i.e., Education Tax, National Insurance Scheme (NIS), National Housing Trust (NHT) and Human, Employment and Resource Training (HEART) contributions) which have been filed and paid on time.
Promotional Tax Credit (R&D and Training) – A promotional tax credit in an amount equal to the developer’s or occupant’s expenditure on R&D and training, up to a maximum which is equal to 10% of the tax on the Developer’s or Occupant’s chargeable income from a trade, profession or vocation within the zone and any amount of professional tax credit that exceeds the 10% in a year of assessment shall not be credited against tax payable in any other year of assessment and shall not be subject to a refund under the Income Tax Act.
Capital Allowance – Capital Allowance is allowing taxpayers to get tax relief on their tangible capital expenditure by permitting it to be deducted against their annual taxable income.
Customs Duty Relief – Customs or Import Duty, is the duty payable on imported goods and is assessed based on the type of item and cost of the goods imported. The Developer or Occupant is exempted from Customs duties on items imported into the Zone.
Stamp Duty Payable – Stamp duty is also known as a documentary stamp tax. This duty is imposed on a range of legally recorded document or instruments pursuant to the Stamp Duty Act.
There will be:
- Exemption of 50% of stamp duty payable on instruments used for the purchase, lease or other acquisition of land for the use as a zone by a Developer.
- Exemption of 100% of stamp duty payable on instruments used for the sale or lease of land by the developer to Occupants or Zone Users in connection to the development or operation of the Zone.
Relief from Transfer Tax - Transfer tax is the passing of title to property from one person or entity to another. This tax is imposed on the transfer of title. A Developer is exempted from transfer tax payable under the Act on the sale of land by the Developer for the purposes of use in the development of operation of the zone.
Disclaimer: The above definitions are guides and are not substitutes for the Special Economic Zones Act, Income Tax Act, General Consumption Tax Act, Stamp Duty Act and Transfer Tax Act.