20-YR TAX HOLIDAY BEGINS

MBABANE – Domestic and foreign investors that seek to enjoy a 20-year tax holiday have been invited to make applications.

If successful in their applications, these investors who will set up business at or around King Mswati III International Airport and at the Royal Science and Technology Park will not pay the 27.5 corporate tax, for 20 years.

As if that is not enough, after the lapse of the 20 years, the companies will then pay five per cent corporate tax forever. This is according to the Special Economic Zones Act of 2018. According to the Act, the Royal Science and Technology Park and the King Mswati III International Airport have been declared as Special Economic Zones (SEZ).

Minister of Commerce, Industry and Trade Jabulani Mabuza explained that applications would be reviewed by the committee established in terms of the legislation. He said they would take as many applications as they possibly could because the ultimate objective of the act would be to create jobs, diversify the economy and assure value addition on locally produced commodities.

“Our focus will mainly be on the investors who will seek to export their produce,” said Mabuza during the tour of Watermann led by Thabiso Kunene who is the 2017 Entrepreneur of the Year (EYA) yesterday at the Gables.

Domestically

The minister said businesses that may seek to domestically supply their produce from special economic zones would be expected to export at least 80 per cent.
He clarified that for the 20 per cent distributed to local markets, the businesses would be expected to pay taxes in accordance with the law to avoid disadvantaging competitors who may not be enjoying the tax holiday.

“We have already received three applications from businesses in Dubai, Nigeria and South Africa,” Mabuza disclosed. 
A special economic zone means a designated geographical area or building to facilitate the provision of services including, but not limited to, business processing outsourcing centres, call centres, management consulting and advisory services and other associated services. A special economic zone shall facilitate the creation of an industrial complex, having strategic national economic advantage for targeted investments and industries in the manufacturing sector and tradable services develop infrastructure required to support the establishment of targeted investments.

Most importantly, companies willing to set up at the special economic zones and to stand a chance to benefit from the set incentives must have minimum capital investment not less than E15 million for a sole trader and E30 million for joint ventures.

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