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Income Tax Act (Schedules)

FIRST SCHEDULE
(Section 10)

15 of 1990, s. 6

PART 1

TAX HOLIDAYS

PART II

LOCAL VALUE ADDED CALCULATION

PART III

TAX RELIEF ON EXPORT PROFITS

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SECOND SCHEDULE
(Section 11)

15 of 1990, s. 6

PART 1

TOURIST HOTELS, RESORTS AND OTHER TOURIST ORIENTED PROJECTS

1. - (1) There shall be exempt from income tax, the profits and income for a period of five years, accruing to any approved enterprise operating -

(a) tourist hotels of three hundred or more bedrooms;

(b) tourist hotels of fifty or more bedrooms or

(c) other tourist oriented projects,

which are approved by the Board as qualifying for the grant of tax exemptions.

(2) The tax exemption of five years referred to in paragraph 1 shall be calculated from the date on which such approved enterprise commenced to trade.

2. - (1) In addition to the tax exemptions on the profits and income of any approved enterprise qualifying under sub-paragraph (1) of paragraph 1, such approved enterprise shall be entitled to -

(a) a fifty per cent depreciation of capital expenditure (excluding land) against annual chargeable income until claimed in full;

(b) a one hundred and fifty per cent tax deduction for expenses incurred in overseas promotion programmed conducted with the prior approval of the Commissioner.

(2) The benefits referred to in sub-paragraph (1) shall not be available to an approved enterprise in respect of which an order under section 18(6) has been made by the Minister.

3. Subject to the provisions of this Part, where any tourist hotel or resort in operation 1^st February 1991, satisfies the Board that such tourist hotel or resort has on or after 1^st January, 1989, incurred capital expenditure in respect of any expansion, additional construction or renovation, such tourist hotel or resort shall be entitled to claim from the Commissioner the exemptions set out in paragraphs 1 and 2 (1) (a) of this Schedule.

4. Any approved enterprise engaged in the operation of tourist vessels built locally shall be entitled to write off fifty per cent of the cost of the vessel.

PART II

TAX RELIEF ON EXPORT PROFITS

5. - (1) Subject to the provision of sub-paragraph (2), there shall be exempt from income tax for a period of three to six years from the date on which a company made its first export of -

(a) manufactured or processed goods;

(b) fresh seafood; or

(c) fresh agricultural produce,

such part of the profits and income of that company as consists of the export profits and income.

(2) The provisions of sub-paragraph (1) shall not be available to an approved enterprise granted tax exemptions under section 10 based on the local value added scheme.

6. - (1) An allowance equal to one hundred and fifty per cent of any sum expended by any company in the promotion and marketing of exports shall be deducted for the purpose of ascertaining the profits or income from exports, provided such promotion was conducted with the prior approval of the Commissioner.

(2) In ascertaining the sum expended in the promotion and marketing of exports, the Commissioner shall take into consideration the costs incurred in -

(a) researching foreign markets;

(b) marketing and testing of potential products in target markets abroad;

(c) travelling overseas for the purpose of conducting promotion exercises;

(d) testing of products by approved overseas agencies;

(e) advertising in overseas markets and publications;

(f) distributing promotional literature overseas;

(g) participating in trade fairs, trade missions and missions of a similar character; and

(h) providing free samples to clients overseas which are not return-able to Solomon Islands.

PART III
AGRICULTURE, FORESTRY, ANIMAL HUSBANDRY AND FISHERIES

7. - (1) Any approved enterprise engaged in the business of -

(a) agricultural production or export of agricultural produce;

(b) dairy farming;

(c) goat farming;

(d) beef production;

(e) re-afforestation; or

(f) fisheries, off-shore or deep-sea fishing,

shall be entitled to claim exemption from income tax in respect of its income and profits for a period of five years out of any ten years from the date of commencement of commercial production.

(2) Subject to the provisions of this Part, where any approved enterprise engaged in any business sector referred to in sub-paragraph (1) satisfies the Board, that such approved enterprise has on or after the 1st day of January, 1989, incurred capital expenditure in expanding its existing business or project, such approved enterprise shall be entitled to claim from the Commissioner the exemptions from income tax in respect of its income and profits for a period of five years out of any ten years.

PART IV

FACTORY CONSTRUCTION

8. Any approved enterprise that has on or after the 1st day of January, 1989, constructed or engaged in an expansion of its factory space by five per cent or over for its own use shall be entitled to write off as depreciation for per cent in the first year and five per cent per annum thereafter.

PART V

OTHER INCENTIVES

9. An approved enterprise may in addition to the incentives provided for in Parts I, II, III and IV claim -

(a) double deduction for tax purposes where the company incurs expenditure for bona fide sponsored apprentices attending Solomon Islands College of Higher Education courses and other approved trade, technical or supervisory training schemes;

(b) double deduction for tax purposes where the company incurs expenditure on professional training for bona fide sponsored higher education courses locally and overseas; and

(c) a one hundred and fifty per cent tax deduction of costs incurred by the producer in inter-province transport of raw materials and qualifying products.

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THIRD SCHEDULE
(Section 16)