Export Incentives

 The export income deduction will remain at 50 per cent in 2010. The deduction is available to all exporters except for re-exports.

 

“Export income” means net profits derived by a taxpayer from the business of exporting goods and services but excludes re-exports. The export income deduction will only be allowed if the Commissioner of Inland Revenue is satisfied that the export earnings will be remitted in Fiji.

     

The Duty Suspension Scheme (DSS) belongs to the category of Customs arrangements referred to internationally as "inward processing" arrangements. The Scheme enables exporters to have access to inputs without having to pay for duties upfront.  Imported goods are conditionally relieved from payment of fiscal duty and VAT on the basis that such goods will be substantially transformed through manufacturing or processing and subsequent exportation. The Scheme would entitle exporters to import duty free an amount equal to the proportion of approved imported inputs required to produce exports. This is called entitled Proportion (EP).
 
The DSS, administered by the Fiji Export Council (FEC), is a Government initiative introduced as part of the Investment Package to enable Fiji exporters to use world priced inputs into their products to make them more competitive. In addition to this, it is envisaged that the scheme would release resources tied up with duty and VAT for export products enabling exporters to operate at their maximum potential.

 

The incentives are applicable to existing businesses in Vanua Levu provided that there is an increased sale by 25% or more and 5 new persons are employed from 2006. The package entails the following: