Seychelles to introduce significant Tax Changes in 2017

Posted in Business and Economy, Seychelles legislation at 10:43 am by Robert Klien

According to the newly released Budget, Seychelles will finalize significant reforms to its main taxes in 2017.

The jurisdiction will complete the introduction of a progressive personal income tax regime from July 1, 2017, rather than January 1, 2017. A SCR 8,555.5 (USD 660) tax-exempt threshold will be introduced, but it will not be available to expatriates. Income tax above that threshold will be subject to progressive rates of 15%, 20%, or 30%.

From July 1, 2017, a new property tax will be introduced on land ownership in Seychelles, to be levied only on foreigners, and purchases of private land by foreigners will also attract a high stamp duty. Further details of the new tax are still under consideration.

Also, it is proposed to change the Business Tax Act. The tax-free threshold for individual businesses, such as sole traders or partners, will remain at SCR 150,000. However to align personal income tax (PIT) and individual business tax rates, the tax rate on profits of between SCR150,000 to SCR1m will be increased from 15 to 20%. Profits above SCR 1 million will continue to be taxed at 33%.

The Government is also proposing that the presumptive tax rate will be realigned. The tax rate on businesses with a turnover of up to SCR 0.5 million is to remain at 1.5%, but a 3% tax will be imposed on businesses with a turnover from SCR 0.5 million. The new cap for the presumptive tax is proposed to rise to SCR 2 million, up from SCR 1 million. Professional taxpayers, such as accountants and engineers, will pay a 5% rate.

Larose also announced that, as from July 1, 2017, the Seychelles Civil Aviation Authority will impose an additional USD 10 passenger service fee. He noted that “the collection will be a direct contribution towards the country’s foreign exchange earnings to maintain the high standard of the Airport.”

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