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.
6. Negotiation and approval of exemption
(1) A person shall not negotiate or enter into an agreement to grant an exemption except with the prior written approval of the Minister.
(2) An agreement to grant an exemption is void unless subsection (1) is complied with.
(3) Where a request for an exemption is contained in a contract to be laid before Parliament for approval, the contract shall be accompanied with
- (a) a detailed assessment of the value of the anticipated exemptions contained in the contract;
- (b) the list of items and taxes to which the exemptions are applicable;
- (c) a limit on the total value of the exemptions to be granted under that contract;
- (d) a time limit on the exemption to ensure that the exemption does not exceed the duration of the contract;
- (e) the impact of the exemption on programmed revenue;
- (f) details of the beneficial owners of the entities involved in the contract; and
- (g) a value for money assessment report.
(4) A contract that contains an exemption shall not be submitted to Parliament unless subsections (1) and (3) are complied with.
(5) Parliament may vary the exemptions in an application for exemption laid before Parliament.
(6) Where Parliament varies the exemptions referred to in subsection (5), the Minister shall, within fourteen days from the date the Minister receives the variation notification, notify the person concerned.
Covered Entities and other Relevant Agencies
====7. Procedure for granting exemption to covered entities (1) An application for an exemption by a covered entity shall be made to the Minister.
(2) The Minister shall assess the application.
(3) The Minister may make a recommendation to Cabinet for consideration.
(4) The recommendation referred to in subsection (3) shall state clearly the basis for the recommendation.
(5) Where the Minister, on an application for an exemption by a covered entity, makes a recommendation for Cabinet approval, Cabinet shall, upon approval, direct the Minister to seek Parliamentary approval.
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;".