Exemptions Act, 2022 - Act 1083

ARRANGEMENT OF SECTIONS

Preliminary Provisions

1. Object of this Act

2. Application

3. Definition of exemption

General Provisions

4. General responsibility

5. Responsibility of the Minister

6. Negotiation and approval of exemption

Covered Entities and Other Relevant Agencies

7. Procedure for granting exemption to covered entities

Privileged Persons

8. The President

9. Diplomats and diplomatic missions

10. Persons with disability

11. Religious organisations

12. Donor and charity organisations

Private Businesses

13. Free zone enterprises

14. General tax incentives

15. Special tax incentives for strategic investments

16. Procedure for granting special tax incentives

Personal Effects, Foodstuffs and Equipment for Trial

17. Baggage and effects

18. Foodstuffs

19. Equipment, replacement parts and others for production trial

Development Partner Projects

20. Executed treaties, agreements or conventions

21. Technical cooperation programmes or projects

22. Programmes or projects funded with grants

23. Concessional facility projects

24. Commercial Government projects

Security Transactions, Administrative Fees and Transnational Levies

25. Transactions by State security agencies

26. Administrative fees and other charges

27. Transnational levies

Miscellaneous Provisions

28. Monitoring and reporting of exemptions

29. Review of tax expenditure

30. Transfer of ownership of exempt item by holder of an exemption

31. Local content

32. Offences and penalties

33. Regulations

34. Interpretation

35. Consequential amendments

36. Repeals, savings and transitional provisions

SCHEDULE

Depreciation of Tax Liability

PURPOSE

AN ACT to regulate the application of tax exemptions and other exemptions and to provide for related matters.

DATE OF ASSENT

12th September, 2022.

ACT

Preliminary provisions

1. Object of this Act

The object of this Act is to

(a) provide for an exemptions regime and the scope of exemptions;

(b) set criteria for exemptions;

(c) provide for the administration of exemptions; and

(d) provide for monitoring, evaluation, reporting and enforcement of exemptions.

2. Application

(1) This Act applies to all exemptions.

(2) This Act shall be read together with any other enactment relevant to taxes, levies, rates, duties, fees and charges and public financial management.

(3) Where there is a conflict or inconsistency between the provisions of this Act and any other enactment related to exemptions, the provisions of this Act shall prevail.

(4) This Act is a "tax law" for purposes of the Revenue Administration Act, 2016 (Act 915).

3. Definition of exemption

(1) For the purposes of this Act, an exemption is

(a) a waiver or variation of a tax, levy, rate, duty, fee or charge provided for under an enactment, or

(b) a variation of the timing of the payment of a tax, levy, rate, duty, fee or charge which results in a reduction in the effective liability of the payer.

(2) Despite subsection (1), the power of the Commissioner-General to remit assessed tax or extend the date on which a tax is payable shall continue to apply.

General Provisions

4. General responsibility

(1) A person shall not be granted an exemption unless the person is entitled to the exemption under this Act.

(2) A person shall not grant an exemption to another person unless the person is authorised to grant the exemption under this Act.

(3) A person shall not waive or vary a domestic indirect tax or enter into an agreement to waive or vary a domestic indirect tax unless expressly provided for in this Act or the relevant tax law.

(4) A person who is granted an exemption under this Act shall not transfer the exemption to another person.

(5) A person shall not waive or vary a tax, levy, rate, duty, fee or a charge imposed by a Local Government Authority unless the waiver or variation is authorised under a bye-law of the Local Government Authority.

5. Responsibility of the Minister

(1) The Minister shall

(a) seek Executive approval for an exemption; and

(b) submit a request for the exemption to Parliament.

(2) The Minister shall, on receipt of a request for an exemption,

(a) assess the request for the exemption; and

(b) ensure that the exemption is consistent with the economic management priorities of Government and the general policy of the Government on exemptions.

(3) The Minister shall issue administrative guidelines on

(a) the procedure for an application for an exemption; and

(b) the modalities for assessing and granting exemptions.

(4) The Minister shall, subject to Executive approval, seek the approval of Parliament by resolution for a request for exemption in accordance with article 174 of the Constitution.

(5) The Minister shall

(a) monitor the use of an exemption as an economic management tool; and

(b) report on the impact of an exemption in the annual national budget presented to Parliament.

(6) The Minister shall inform Cabinet on matters relating to exemptions.

(7) The Minister shall ensure that covered entities and other relevant stakeholders are sensitised on any new law or requirement instituted to

(a) improve the effectiveness and efficiency of the exemptions regime; or

(b) ensure compliance with this Act.

2. Section 19A inserted

The principal enactment is amended by the insertion after section 19, of

"Fishing gear

19A. Fishing gear imported for agricultural purposes and

(a) certified by the Minister responsible for Fisheries and Aquaculture Development, and

(b) approved by the Minister

are exempt from customs duties and customs taxes.".

3. Section 34 of Act 1083 amended

The principal enactment is amended in section 34 by the insertion after the definition for "fee or charge", of

""fishing gear" includes fishing float;".