The 2012 Fiji Budget was delivered yesterday. Highlights for local and foreign investors and businesses follow.
- The corporate tax rate will be lowered from 28 percent to 20 percent from January 1, 2012.
- All insurance companies that charge premiums for the Government-mandated, third-party insurance will now contribute 20 percent of all the premiums collected. This new levy must not result in increased premium payments for the insured
- The Hotel Turnover Tax will be renamed the Service Turnover Tax, or STT. The tax rate will remain the same, but will now be extended to:
- Rental car operators
- In-bound tour operators
- Events management operators
- Recreation, entertainment and cinema operators
- Bars and night clubs
- Bistros or coffee shops with an annual gross turnover of $1.5 million and above
- Restaurants with annual gross turnover of $1.5 million and above
- All water sports, underwater activities, skydiving, hot-air balloon rides, river safaris, aircraft charter or hire including helicopters, with an annual gross turnover in excess of $300,000
- And home stay operators
- From 2012, any equipment and machinery purchased for the purposes of manufacturing will attract a zero-percent fiscal duty. This zero-percent duty will be only for 2012.
- Imported canned fish will see an increase in fiscal duty from 15 percent to 32 percent.
- $500,000 has also been allocated to promote the “Buy Fijian” and “Fijian Made” campaigns in 2012.
- Imported mounting blocks for electrical units will see an increase from 5 percent to 15 percent. This will encourage and support new Fijian manufacturers of this hardware.
- Imported exercise books will see an increased duty from 15 percent to 32 percent, given that local manufacturers now have this capacity.
- Excise tariffs have been imposed on imported nails and nylon rope, of 10 and 15 percent, respectively.
- The government has removed the 40 percent local equity requirement for foreign incorporated companies listed on the South Pacific Stock Exchange. This requirement has previously restricted listing by overseas companies.
The full budget address can be viewed at the Fiji government website.