Gov�t dangles tax cuts to attract SPEDU investors
Onalenna Kelebeile | Wednesday March 8, 2017 18:00
The incentives, which are categorised into six packages, include fiscal incentives, government off-take, provision of land, input costs, softer SPEDU region labour laws and one stop service centre.
The fiscal incentives include a five percent corporate tax for the first five years and 10% corporate tax thereafter.
Currently corporate tax in Botswana stands at 22% while companies in the manufacturing, financial services and those registered with the Innovation Hub attract a 15% corporate tax.
A sub category of fiscal incentives provided in line with Southern African Customs Union provisions provides for zero custom duty on imported raw material and rebate of customs duties and value added tax.
Speaking during the launch of incentives on Monday, the minister of Investment Trade and Industry, Vincent Seretse said in terms of government off-take, at least 30% of the investors’ goods and services will be procured by government in line with the Economic Diversification Drive while the incentive for provision of land is a minimum of 50 years of land leases.
“These incentives are aimed at stimulating private sector investment, technology development, market access and job creation,” Seretse said.
The launch was attended by among others Members of Parliament for the area, senior government officials, town mayor, heads of parastals and coordinator of the Economic Revitalisation Programme for SPEDU, Linah Mohohlo.
The incentives apply to all approved companies in the region in the sectors of agriculture, manufacturing and tourism. However wholesale, retail and banking businesses are excluded.
The SPEDU region covers Selebi-Phikwe, Bobirwa, Tswapong North and Mmadinare.
Seretse also spoke about a SPEDU region labour laws category, which is meant to provide for SPEDU region employer-employee relations and is geared at providing a work environment that promotes productivity and harmonious employer/employee relations.
A one stop service centre is also being set up whose services include delegation of all authority and responsibility to the SPEDU company to issue licences and permits, streamlines processes for issuance of work and residence permits and also for SPEDU to conduct strategic impact analysis and issue all-inclusive environmental impact assessment permit for all investors.
Seretse added that the incentives are designed in a manner that they do not create businesses that are dependent on government.
He added that the investment incentives are meant to address specific industry bottlenecks and business competitiveness requirements and compare favourably with the country’s current tax profile.
“SPEDU is part of this success story and with planned and ongoing projects the region’s attractiveness as an investment destination will be significantly enhanced,” he said. He noted that though there are challenges encountered, all stakeholders should stay positive as government is committed to supporting the SPEDU region relentlessly.
“By taking advantage of these incentives you stand to reap rewards from the region. I encourage you to invest in the SPEDU region and government will ensure that you operate in an environment that enables your businesses to thrive,” he said.