Revision on Customs Duty, Value Added Tax and Excise Tax
November 13, 2018
The Ministry of Finance, Trade, Investment and Economic Planning is announcing a number of revisions on Customs Duty, Value Added Tax, (VAT) and Excise Tax as of next year.
This is in line with the announcement made by the Minister for Finance, Trade, Investment and Economic Planning, Maurice Loustau-Lalanne in the Budget Speech 2019, on 5th November 2018.
The changes are as follows:
- Removal of VAT on canned tuna
- As from 1st of January 2019, the Government has decided to remove the 15 percent VAT on canned tuna, in its effort to reduce the price of canned tuna on the local market for the average Seychellois.
- Excise Tax on Tobacco
- In its continued effort to tackle excessive tobacco consumption in the country, Government will,as of January 2019, increase the rate of excise tax on all imported and manufactured tobacco products by 10%. This change will apply on products such as cigarettes, cigars, cigarillos and the likes. Government recognises the significant costs to the budget that is allocated for treatment of tobacco-related diseases and remains engaged in combatting the effects that these products have on society.
- Legislative amendment Governing Excise Tax for fuel concession
- In its continued effort to tackle excessive tobacco consumption in the country, Government will,as of January 2019, increase the rate of excise tax on all imported and manufactured tobacco products by 10%. This change will apply on products such as cigarettes, cigars, cigarillos and the likes. Government recognises the significant costs to the budget that is allocated for treatment of tobacco-related diseases and remains engaged in combatting the effects that these products have on society.
- A phase-out approach will now be used to remove fuel concessions for Tourism Incentives Act, (TIA) Licensed Operators in Hire Craft, Dive Centre, Tour Operator, Cruise Ship, Yacht/Live aboard Operator, for all entities in possession of a TIA Certificate, and benefit from tax concessions on fuel. This measure comes after a series of consultations done by the Ministry of Finance, Trade, Investment and Economic Planning with all the relevant stakeholders. The Ministry has taken note of their concerns and that concessions for the above operators will be now be reduced in two phases:
- From January 2019, the concessions will be reduced from 50% to 25%
- From January 2020 from 25% to Nil
The same approach will be used to remove fuel concession for Helicopter Services Licensed Operators.
- From January 2019, the concessions will be reduced from 25% to 12.5%
- From January 2020 from 12.5% to Nil
All listed operators will be liable to the full taxes on fuel purchased as of the1st January 2020.
- Review of Customs Duty on Pork and Poultry
As of the 1st of January 2019, the new Customs duty on frozen pork and poultry will be as follows;
- Pork: Rate of customs duty will be increased from 15%, to 15%+ SCR 3;
- Poultry: Rate of customs duty will be increased from 15%+ SCR5/kg, to 15% + SCR5.92/kg
The increase in Customs Duty shall not be applicable on products originating from countries with which Seychelles has a Free Trade Agreement (FTA), notably from Members of the Common Market of Eastern and Southern African States FTA, the Southern African Development Community FTA and the European Union.
This revision has been done in line with the efforts of the Ministry of Agriculture and Fisheries to promote local production of pork and poultry meat, as well as taking into account the need to ensure food security by safeguarding the sustainability of our local producers. The levies will still be used to support the agricultural sector.
The Ministry would also like to reiterate that the increase only applies to Customs Duty and that these products shall remain VAT exempted.