CAP. 54 FISCAL INCENTIVES ACT BELIZE
FISCAL INCENTIVES ACT
CHAPTER 54
REVISED EDITION 2000
SHOWING THE LAW AS AT 31ST DECEMBER, 2000.
This is a revised edition of the law, prepared by the Law Revision Commissioner
under the authority of the Law Revision Act, Chapter 3 of the Laws of Belize,
Revised Edition 1980 - 1990.
This edition contains a consolidation of the following laws - Page
ARRANGEMENT OF SECTIONS 3
FISCAL INCENTIVES ACT 4 Amendments in force as at 31st December, 2000
BELIZE
FISCAL INCENTIVES ACT
CHAPTER 54
REVISED EDITION 2000
SHOWING THE LAW AS AT 31ST DECEMBER, 2000.
This is a revised edition of the law, prepared by the Law Revision Commissioner
under the authority of the Law Revision Act, Chapter 3 of the Laws of Belize,
Revised Edition 1980 - 1990.
This edition contains a consolidation of the following laws - Page
ARRANGEMENT OF SECTIONS 3
FISCAL INCENTIVES ACT 4 Amendments in force as at 31st December, 2000
THE SUBSTANTIVE LAWS OF BELIZE REVISED EDITION 2000
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Fiscal Incentives
CHAPTER 54
FISCAL INCENTIVES
ARRANGEMENT OF SECTIONS
1. Short title.
2. Interpretation.
3. Application for an order.
4. Conditions for making an order.
5. Date of production.
6. Tax holiday.
7. Duty exemption.
8. Requirements as to goods imported.
9. Assignment of goods imported.
10. Annual report.
11. Revocation.
12. Notice and consequences of revocation.
13. Transfer of status.
14. Change of name.
15. Laying of information and complaint.
16. Provision for making regulations.
17. Repeals.
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Fiscal Incentives
SCHEDULE
CHAPTER 54
FISCAL INCENTIVES
[17th April, 1990]
1. This Act may be cited as the Fiscal Incentives Act.
2. In this Act, unless the context otherwise requires:-
“approved enterprise” means an enterprise or undertaking in respect of which an approved enterprise order has been made under this Act;
“approved enterprise order” means an order made under section 4 including any amendment thereto made from time to time;
“approved product” means a product approved by the Minister for produc- tion or manufacture by an approved enterprise;
“approved service” means a service approved by the Minister provided by an approved enterprise;
“company” means a company formed and registered under the Companies Act;
“Comptroller” means the Comptroller of Customs;
“date of production” means the date specified in the approved enterprise order by which the enterprise shall have commenced production;
6 of 1990.
20 of 1996.
3 of 2000.
Short title.
Interpretation.
CAP. 250.
CAP. 45,
R.E. 1980-1990.
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Fiscal Incentives
“duty exemption period” means the period during which an enterprise enjoys the relief granted under section 7;
“Executive Chairman of BELTRAIDE” means the Executive Chairman of the Belize Trade and Development Investment Service appointed pursuant to sec- tion 7 of the Belize Trade and Development Investment Service Act;
“income tax” means any tax on income or profits;
“industry” means a manufacturing or processing industry and includes agricul- ture, aquaculture, forestry and fisheries;
“Member State” means a State listed in the Schedule hereto;
“Minister” means the Minister responsible for Investment;
“national” means a citizen of any Member State and includes a person who by virtue of some law of a Member State relating to immigration is deemed to belong to that State;
“rule of origin” means the criteria as defined in Article 14 and Schedule II of the Annex to the Treaty of Chaguaramas establishing the Caribbean Commu- nity and any amendments made thereto from time to time;
“tax holiday period” means the period during which an enterprise enjoys the relief granted under section 6.
3.-(1) Any person desirous of establishing or conducting an enterprise in Belize may apply to the Minister through the Executive Chairman of BELTRAIDE for an approved enterprise order in relation to the proposed enterprise and shall furnish to the Executive Chairman of BELTRAIDE in support of his applica- tion-
(a) particulars as to the nature of the enterprise and the contribu- tion which it is expected to make to the economy;
(b) the estimated amount, purpose and source of the capital to be expended, initially and annually, during the period of the ap- proved enterprise order;
3 of 2000.
Schedule.
Application for
an order.
3 of 2000.
CAP. 282.
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(c) where applicable, particulars necessary to determine whether the product meets the rule of origin;
(d) where applicable, particulars necessary to determine the level of exports, foreign exchange earnings or foreign exchange savings;
(e) the number of persons to be employed and the conditions of service;
(f) the date on or before which-
(i) work on the enterprise will commence;
(ii) the enterprise will produce a marketable product;
(g) information satisfactory to the Minister that the enterprise is adequately financed and provided with effective and compe- tent management;
(h) such other information as the Executive Chairman of BELTRAIDE may require.
(2) Every application made under subsection (1), and every application for renewal made under section 6 (1) and section 7 (1), shall be accompa- nied by the fees specified below:
Investment of not less than $250,000 and not exceeding $500,000 - $5,000;
Investment of not less than $500,000 and not exceeding $750,000 - $6,000;
Investment exceeding $750,000 - $7,000:
Provided that a “Belizean Company” as defined in subsection (3) below with investment of less than $250,000 may apply under this section without the payment of any fee.
3 of 2000.
Fees payable.
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(3) For the purpose of subsection (2) of this section a “Belizean Com- pany” means a company in which Belizean nationals own not less than fifty- one per cent of the share capital.
(4)The Minister may from time to time, by order published in the Gazette, amend the scale of fees payable under this section.
(5)Every order made by the Minister under the proviso of subsection (2) shall as soon as may be after the making thereof be laid before the National Assembly and shall be subject to negative resolution.
4.-(1) If the Minister is satisfied that-
(a) a company has been incorporated in Belize which will establish or conduct the enterprise in respect of which an application has been made under section 3;
(b) the enterprise will be beneficial to the economy of Belize; and
(c) it is expedient in the public interest to do so,
he may by order declare the enterprise to be an approved enterprise.
(2)Before making an order, the Minister shall-
(a) cause a notice to be published in two issues of a newspaper circulating in Belize at an interval of not less than one week between each issue and in one issue of the Gazette, containing sufficient information relating to the enterprise, and inviting any person who objects to the making of such an order to give notice of his intention to object within the period specified in the notice, and thereafter to submit in writing his objections and the supporting evidence within fourteen days of his notice of objection to the Executive Chairman of BETRAIDE;
(b) consider any objections received pursuant to the notice.
(3) Such order shall set out the conditions subject to which it has been made.
Conditions of
making an order.
3 of 2000.
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(4) No such order shall be granted for an enterprise the products of which are destined for the domestic or Caricom market unless the products satisfy the rule of origin as defined in section 2.
5. Every order made by the Minister under section 4 shall specify the date of production of the approved enterprise, which shall be the date not more than five years after the date of the approved enterprise order by which date the Minister has reasonable cause to believe the enterprise should be established and be in commercial production or operation:
Provided that, in the case of any such order in respect of any enterprise that is at the date of the order already established and in commercial production or operation, the date of production shall be the date of the approved enterprise order.
6.-(1) (a) Subject to subsection 9 and to paragraph (b) of this subsec- tion, every order made by the Minister under section 4 shall specify-
(i) the duration of the tax holiday period, which shall nor- mally be of not more than five years duration com- mencing from the date of production; and
(ii) the annual percentage rates at which the profits and gains of the approved enterprise shall be exempt from the payment of income tax under the Income and Business Tax Act during the tax holiday period:
Provided that the Minister may, in a fit and proper case, on application made by the company, review its operations and renew its tax holiday period for a further term not exceeding ten years.
(b) In the case of a company which is engaged in agriculture, agro- industry, food-processing, mariculture or manufacturing and whose operation is highly labour intensive and whose pro- duction is strictly for export, the tax holiday period may be for a maximum of twenty-five years.
Date of produc-
tion.
Tax holiday.
20 of 1996.
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(2) During the tax holiday period, all profits and gains accruing to the ap- proved enterprise and arising from the production of the approved product or service shall be partially exempt from income tax under the Income and Busi- ness Tax Act, at the annual percentage rates specified by the Minister as pro- vided in subsection (1)(a)(ii) above.
(3) If the end of the tax holiday period does not coincide with the end of the financial year of the approved enterprise, the income attributable to the tax holiday period only shall be exempt from income tax at the annual percentage rates specified by the Minister as provided in subsection (1)(a)(ii) above.
(4)Subject to the limitations contained in subsections (5) and (6), where an approved enterprise is conducted by a company, any dividends or other profits arising out of such enterprise-
(a) during the tax holiday period of such enterprise; and
(b) paid to shareholders during the said period, on shares issued dur- ing such period,
shall not be taken into account in ascertaining the chargeable income of such shareholders.
(5)The provisions of subsection (4) shall only apply where the total amount of dividends or profits paid to a shareholder, as therein mentioned, does not exceed an amount which is equivalent to the total amount invested by the share- holder in the approved enterprise during its tax holiday period.
(6)The provisions of subsection (4) shall not apply to any shareholder who would become liable by the laws of his country of residence to pay additional income tax owing to the fact that the dividend he received hereunder was not subject to income tax in Belize.
(7)An approved enterprise enjoying partial relief from income tax shall, not- withstanding the relief granted, be subject in all other respects to the provisions of the Income and Business Tax Act, including the filing of annual returns.
20 of 1996.
CAP. 55.
20 of 1996.
20 of 1996.
19 of 1998.
CAP. 55.
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(8) To the extent that an approved enterprise is partially exempt from income tax during a tax holiday period at the rates specified by the Minister as provided in subsection (1)(a)(ii) above, the approved enterprise shall be deemed to be a specified development industry or project for the purpose of the Income and Business Tax Act.
(9) Notwithstanding the provisions of this section it shall be open to the Minister to order that no tax holiday shall be granted to an enterprise under this Act.
7.-(1) (a) Subject to subsection (4) and to paragraph (b) of this subsec- tion, every order made by the Minister under section 4 shall specify the duty exemption period which shall be of not more than fifteen years duration com- mencing from the date of the approved enterprise order, provided that the Minister may, in the case of an export enterprise, on application made by the company, review its operations and renew the duty exemption period for a further term not exceeding ten years.
(b) In the case of a company which is engaged in agriculture, agro- industry, food-processing, mariculture or manufacturing and whose operation is highly labour intensive and whose pro- duction is strictly for export, the duty exemption period may be for a maximum of twenty-five years.
(2) Subject to subsection (3), during the duty exemption period, every company granted an approved enterprise order may import into Belize, free of customs duty and stamp duty-
(a) all building materials, plant, machinery, equipment, tools in- cluding specialist hand tools (but not including other hand tools), utility and transport vehicles, fixtures and fittings, office equip- ment, and appliances;
(b) spare parts on plant and plant related machinery and agricul- tural machinery;
(c) any raw materials or other items imported for use in the ap- proved enterprise,
20 of 1996.
CAP. 55.
19 of 1998.
Duty exemption.
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upon production to the Comptroller of a certificate issued by the Executive Chairman of BELTRAIDE Secretary that such articles or materials are neces- sary for the establishment or expansion and conduct of the approved enter- prise, and upon such terms and conditions as may be specified in the certificate.
(3)Except in the case of an export enterprise exporting to non-Caricom countries, no duty exemption shall be granted for any raw materials or articles which are available in Belize or in any Member State provided that they are of comparable quality and price.
(4)Notwithstanding the provisions of this section it shall be open to the Min- ister to order that no duty exemption shall be granted to an enterprise under this Act.
8. The enterprise importing articles under section 7 above shall-
(a) keep a record in such form and containing such particulars as may be required by the Comptroller of the articles so im- ported;
(b) cause the articles to be marked with such mark and in such manner as may be required by the Comptroller;
(c) permit the Comptroller or any person authorised by him at any reasonable time to inspect such record and to examine any such article for the purpose of satisfying himself of the accuracy of the particulars in the record in relation to the article.
9.-(1) No article imported under this Act into Belize free of import duty, stamp duty or revenue replacement duty shall be sold, hired, lent, given away or oth- erwise disposed of except-
(a) in case of an assignment of an enterprise, to the as signee thereof; or
(b) after payment of import duty, stamp duty and revenue replace- ment duty on the value of the article at the date of the transac- tion assessed by the Comptroller; or
3 of 2000.
Requirements as
to goods
imported.
Assignment of
goods imported.
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(c) after expiry of ten years from the date of importation.
(2)An enterprise which contravenes or fails to comply with any of the pro- visions of this section shall be guilty of an offence and shall be liable upon summary conviction to a fine equal to treble the market value of the goods as assessed by the Comptroller of Customs or to a fine of five thousand dollars, whichever is the greater, and in every such case the goods in respect of which the offence was committed shall be forfeited.
10.-(1) During the duty exemption period there shall be submitted to the Ex- ecutive Chairman of BELTRAIDE, within three months of the close of each financial year of the approved enterprise, a report in writing on the conduct and progress of the approved enterprise during the past financial year together with the annual accounts for that year duly audited by a Chartered Accoun- tant.
(2) The accounts shall contain particulars-
(a) as to capital expended on the enterprise and depreciation of the capital assets during the financial year in question;
(b) relating to the enterprise which the Executive Chairman of BELTRAIDE may require.
(3) An enterprise which fails to furnish the reports and annual accounts as required under this section shall be liable to pay to the Government a penalty of two thousand dollars (or such lesser figure as may be determined by the Minister on the facts of the particular case), and the failure to pay the amount so specified may result in the revocation of the concession.
11.-(1) If the Minister is satisfied that the enterprise has contravened any of the provisions of this Act or a regulation made thereunder, and in particular as to the fact that-
(a) there has been undue delay in the commencement of an ap- proved enterprise; or
(b) the approved enterprise is not being conducted in accordance with the terms of the application for an order under section 3 or of the order under section 4; or
Annual report.
3 of 2000.
3 of 2000.
Penalty.
Revocation.
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(c) the information furnished in the application for an order is false in a material particular,
he may give a written notice to the approved enterprise to show cause within such period as may be specified, but not less than thirty days, as to why the approved enterprise order should not be revoked and, if the Minister is not satisfied by the explanation, if any, given by the approved enterprise he may in his discretion revoke the approved enterprise order.
(2)Notwithstanding the previous subsection (1), the Minister may, at the written request of an approved enterprise, revoke the approved enterprise or- der whether or not there was a breach of the terms and conditions of the order or any other default on the part of the approved enterprise.
12.-(1) When an approved enterprise order has been revoked the Minister shall cause a notice to that effect to be published in the Gazette and the order shall state the date on which the enterprise shall cease or shall have ceased to be an approved enterprise.
(2)Upon revocation the approved enterprise shall be liable to pay customs duty, stamp duty and revenue replacement duty on such of the articles, as the Minister of Finance may decide, imported by the approved enterprise free of those duties, such duties being based on the value of the articles at the date of revocation assessed by the Comptroller.
(3)The duties payable under subsection (2) may be recovered the Comp- troller in the manner provided under any law relating to customs and excise duties.
(4) If the date on which the approved enterprise order ceases to be an ap- proved enterprise does not coincide with the end of the financial year of the enterprise, then the chargeable income in respect of the financial year in which the order is revoked shall be subject to tax under the Income and Business Tax Act as if no approved enterprise order had been made in respect of that year and such tax shall be recoverable accordingly.
13.-(1) The Minister may, by notice published in the Gazette, transfer the sta- tus of an approved enterprise granted under this Act to another company where-
Notice and
consequences
of revocation.
CAP. 55.
19 of 1998.
Transfer of
status.
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(a) the approved enterprise merges with or is taken over by an- other company, or forms part of another company’s recon- struction; and/or
(b) in his opinion it is equitable or in the public interest to do so.
(2) Prior to the issue of a notice pursuant to subsection (1), the Minister shall require the company, to which the status of approved enterprise is to be transferred, to give an undertaking to comply with the conditions as set out in the order granted under section 4.
(3) On the issue of a notice pursuant to subsection (1), all the rights, privi- leges, benefits, immunities, duties and obligations conferred or imposed by or under this Act on the approved enterprise may be transferred to the other company.
14.-(1) Where an approved enterprise changes its corporate name, that en- terprise shall, within fourteen days of the date of such change, inform the Ex- ecutive Chairman of BELTRAIDE in writing of its new corporate name.
(2) On receipt of such information the Minister may, by notice published in the Gazette, direct that any orders, licences or documents issued to or in respect of that approved enterprise under or pursuant to the provisions of this Act be altered to indicate the new corporate name.
15. An information or complaint in respect of an offence under this Act may be laid by the Executive Chairman of BELTRAIDE or by any other per- son authorised in writing by the Executive Chairman of BELTRAIDE in that behalf.
16.-(1) The Minister may make such regulations as may be necessary for giving effect to the provisions of this Act.
(2) Any regulations made pursuant to subsection (1) of this section shall be laid before the National Assembly as soon as may be after the making thereof and shall be subject to negative resolution.
17.-(1) The Development Incentives Act and the Fiscal Incentives (Industrial Enterprises) Act are hereby repealed.
Change of name.
3 of 2000.
Laying of informa-
tion and complaint.
3 of 2000.
Provision for
making regula-
tions.
Repeals.
CAP. 40,
R.E. 1980-1990.
32 of 1973.
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(2) Notwithstanding subsection (1), any development order or approved enterprise order granted under the Development Incentives Act or under the Fiscal Incentives (Industrial Enterprises) Act shall be deemed to have been granted under this Act, and every such order shall be subject to all rights, privi- leges, benefits and obligations conferred or imposed by or under this Act.
CAP. 40,
R.E. 1980-1990.
32 of 1973.
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SCHEDULE
[Section 2]
Member States
Antigua and Barbuda
Barbados
Belize
Dominica
Grenada
Guyana
Jamaica
Montserrat
St. Christopher and Nevis
St. Lucia
St. Vincent and the Grenadines
Trinidad and Tobago
Any other state in the Caribbean region that becomes a member of the Caribbean Single Market and Economy.
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