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Sales Tax (Amendment) Act 2014

SOLOMON ISLANDS

SALES TAX (AMENDMENT) ACT 2014

(NO. 10 OF 2014)

PASSED by the National Parliament this twenty-eighth day of May 2014.

(This printed impression has been carefully compared by me with the Bill passed by Parliament and found by me to be a true copy of the Bill)

Taeasi Sanga (Mrs)
Clerk to National Parliament

ASSENTED to in Her Majesty's name and on Her Majesty's behalf this twelfth day of June 2014.

Sir Frank Utu Ofagioro Kabui
Governor-General

Date of Commencement: see section 1

AN ACT TO AMEND THE SALES TAX ACT (CAP.125) IN ORDER TO STRENGTHEN THE PROCEDURES FOR COLLECTING TAX BY PROVIDING PROVISIONS FOR PREPAYMENT OF TAX AT FIRST POINT OF SALE FOR CERTAIN LIMITED GOODS AND SERVICES.

ENACTED by the National Parliament of Solomon Islands.

ARRANGEMENT OF SECTIONS

1. Short title and commencement
2. Amendment of Section 2
3. Insertion of new sections 2A and 2B
4. Amendment of section 3A
5. Insertion of new section 23A
6. Amendment of Schedule
7. Insertion of new Schedule Two

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SALES TAX (AMENDMENT) ACT 2014

PART 1 -PRELIMINARY

Short title and commencement

1. This Act may be cited as the Sales Tax (Amendment) Act 2014 and shall come into operation on such date as the Minister may appoint by notice published in the Gazette.

Interpretation

2. Section 2 of the Sales Tax Act (hereinafter referred to as the "principal Act") is hereby amended in the following respects —

(a) by inserting after the definition of "prescribed goods or services" the following new definition —

" "prepayment type goods and services" means prescribed goods or services declared to be subject to prepayment by or pursuant to this Act and set out in Schedule Two";

(b) in the definition of "purchaser" by adding at the end of paragaph (b) the word "or" and inserting thereafter the following new paragraph as paragraph (c) –

"(c) any person who acquires prepayment type goods or services anywhere; "

(c) in the definition of "sale" or "sells" by adding at the end of paragraph (d) the word "or" and inserting thereafter the following new paragraph as paragraph (e) –

"(e) a sale of prepayment type goods or services to a purchaser;"

(d) in the definition of "value" –

(i) by deleting the word "and" that appears at the end of paragraph (b);

(ii) by adding at the end of paragraph (c) the word "and", and inserting thereafter the following new paragraph as paragraph (d) –

"(d) in the case of prepayment type goods or services, the greater of –

(i) the price for which the prepayment type goods or services were purchased as expressed in terms of Solomon Islands currency; or

(ii) the price for which prepayment type goods or services are generally sold to consumers".

Insertion of new sections 2A and 2B

3. The principal Act is amended by inserting after section 2 the following new sections as sections 2A and 2B respectively –

"Vendor to provide record of prepaid sales tax

2A The vendor of prepayment type goods or services on which sales tax has been prepaid must provide to a purchaser a record of the sales tax prepaid in respect of the goods or services being purchased."

"Reduction of sates tax prepaid

2B The amount of sales tax a purchaser is charged on prepayment type goods or services is reduced by any sales tax prepaid in respect of the goods or services being purchased, consistent with the record of prepaid tax provided by the vendor in accordance with section 2A."

Amendment of section 3A

4. Section 3A of the principal Act is amended by deleting the word "There" that appears at the commencement of that section and inserting the following words "Notwithstanding the application of the definition of prepayment type goods and services, there".

Insertion of new section 23A

5. The principal Act is amended by inserting after section 23 the following as section 23A –

"Commissioner's ruling

23A (1) The Commissioner may, by way of a public ruling, explain the Commissioner's interpretation of any provisions of the Act;

(2) The Commissioner may not collect tax greater than that due under the provisions of this Act as interpreted by the Commissioner in a public ruling authorized by this section.

(3) The Commissioner may not seek to impose any penalty for failure to pay tax exceeding that due under the provisions of this Act as interpreted by the Commissioner in a public ruling authorized by this section."

Amendment of Schedule

6. The principal Act is amended by replacing the present heading to the Schedule with the words "SCHEDULE ONE".

Insertion of new Schedule Two

7. The principal Act is amended by inserting after the existing Schedule a new Schedule as "SCHEDULE TWO".

"SCHEDULE TWO

Prepayment Type Goods and Services

1. Local and Overseas Telecommunications

2. Sale of petroleum from any premises licensed under the Petroleum Rules

3. Sale of diesoline from any premises licensed under the Petroleum Rules".

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