Zanzibar Investment Promotion and Protection Act offers lucrative package of incentives. It also provides amazing opportunity to strategic investors.
Project approved under Free Economic Zone regime may enjoy the following incentives:
- Ten (10) years Corporate Tax Holiday and 25% Tax for the subsequent ten years.
- Ten (10) years Withholding Tax Holiday on dividend to non-residents.
- 75 percent Duty and VAT Exemption on raw materials, machinery, equipment and other inputs.
- Stamp Duty Exemption.
- 100 percent investment deduction on capital expenditure within 20 years.
- Exemption from tax on dividend for ten years.
- Duty and Tax Free Import of goods from domestic tariff area permissible.
- Duty Free import of material for construction of factory buildings.
- Duty Free export of goods produced.
- Exemption of Income Tax on interest on borrowed capital.
- Exemption from payment of all taxes and levies imposed by local government authorities for goods and services produced in a Free Economic Zones.
- On site customs inspection of goods in lieu of off-port inspection.
Project approved under Free Port regime may enjoy the following incentives:
- Exemption from payment of import duty, exercise duty, sales tax, (VAT) and any other import levy on all goods imported into the Freeport Zones.
- Exemption from any tax on all goods destined for re-exports.
- Exemptions from local taxes against all goods produced in the Free ports that are exported.
- Exemption from payment of Corporate Tax for the first twenty (20) years.
- No limit to the duration that goods may be stored in the Freeport Zones.
- Hundred percent (100%) retention of all profits.
- Hundred percent (100%) foreign ownership allowed.
- Free repatriation of profit.
- Twenty percent (20 %) of total turnover allowed for sale to the local market and subject to the payment of all taxes.
Project approved outside Freeport and Free Economic Zones may enjoy the following incentives:
- During the construction phase for an approved enterprise, or approved domestic enterprise, the enterprise shall be exempted 75 % from customs and import duties and other similar taxes on machinery, equipment, spare parts, raw materials, vehicles and other goods necessary and exclusively required by that enterprise for the construction phase.
- Raw materials for the trial operations of an approved enterprise or approved domestic enterprise may be exempted from import duties.
- Provided the quantity of such raw materials does not exceed eighteen months’ supply for one shift production operation.
- Five year tax holiday