At its last sitting the Belize’s House of Representative presented several bills which are expected to be signed into law in the next couple of weeks. The applicable bills are:

1. Income and Business Tax (Amendment) Act – The amendment to the Income and business tax act is to provide tax relief to employed persons making less that BZ$24,000 per annum and to increase the rate of business tax for electricity supply services from 1.75% to 6%.

With respect to the amendment to the employment threshold, this has been proposed to be retroactive to January 1, 2010, with 2 basic thresholds; in the case of employed individuals whose total income in a basis year from all sources is less than $24,000, the threshold is $23,600. The second threshold in case of all other employed individuals is $19,600. Which basically means that employment income from all sources which is less than BZ$23,999 annually ($461.52 weekly) would be exempt from income tax. As this amendment has not been signed into law it is not advisable to make changes to your payroll spreadsheets and programs but employers should be prepared for implementation effective April 1, 2010.

2. General Sales Tax (Amendment) Act 2010 – The general sales tax amendment increases the GST rate from 10% to 12.5%. For resorts and hotels who are partially exempt and are unable to fully recover most of their costs relating to accommodations this potentially translates into an additional 2.5% on procurement of applicable goods and services. With respect to restaurants and tour operators, while the costs of providing the goods and services increases by 2.5%, they should be able to recover via the input credit mechanism. The effective date of the increase in the rate of the general sales tax (from 10% to 12.5%) is expected to be April 1, 2010 and again it is not advisable to make any changes to reflect the new rate until it has been signed into law but business owners should be prepared for implementation effective April 1, 2010.

3. Customs and Excise Duties (Amendment) Act, 2010 – The Customs and Excise Duties Act was also amended to “vary the rate of customs duties on certain goods and lower the costs of living; to provide for an excise duty on locally extracted crude oil.”

For hotels and resort owners, of interest is that the amendment seeks to exempt “essential consumable items such as bed linens, towels, carpets imported by small licensed hotel and guest house operators for the running of their businesses.” However, small license hotels and guest houses was not defined in this amendment and may be interpreted to mean 10 rooms or less. There are of course other factors such as room rates and annual revenues which can be used to define small license hotels and guest houses.

The amendment to the Customs and Excise Duties Act also seeks to amendment the rate of duties payable on basic food items.

Attached are copies of the proposes amendments.

Regards,

Wilfred Rhaburn, CPA
Managing Partner
W. Rhaburn Consulting

63 Barrier Reef Drive
San Pedro Town
Ambergris Caye, BELIZE

Tel: +501 610 4407
P.O. Box: Unit 540, Quicksilver Messenger Service
E-mail: wrhaburn@consultingbelize.com
Website: www.consultingbelize.com


Originally Posted By: Bill - Income and Business Tax Bill - Mar 2010
Income and Business Tax

BELIZE:
BILL

for

AN ACT
to amend the Income and Business Tax Act, Chapter 55 of the Laws of Belize, Revised Edition 2000-2003, to provide tax relief to employed persons earning less than $24,000 per annum; to increase the rate of business tax for electricity supply services; and to provide for matters connected therewith or incidental thereto.
(Gazetted……………, 2010).

BE IT ENACTED, by and with the advice and consent of the House of Representatives and the Senate of Belize and by the authority of the same, as follows:-

1.
Short title.
2. This Act may be cited as the
INCOME AND BUSINESS TAX (AMENDMENT) ACT, 2010,


CAP. 55

Act No. 3/01
3/04
6/05
14/05
10/06
16/08
6/09


and shall be read and construed as one with the Income and Business Tax Act which, as amended, is hereinafter referred to as the principal Act.

Amendment of section 16.
2. Section 16 of the principal Act is hereby amended by repealing subsection (1) thereof and replacing the same by the following:

“(1) In ascertaining the chargeable income of an employed individual who is resident in Belize, there shall be allowed a basic deduction in the following amounts:

(a) in the case of an employed
individual whose total income
in a basis year from all sources
is less than twenty four
thousand dollars … … … … $23, 600.00;

(b) in the case of all other
employed individuals ... … … $19,600.00.”

Amendment of Ninth Schedule.
3. The Ninth Schedule to the principal Act is hereby amended by the addition of the following new item after item (n):

“(o) Receipts of entities providing
electricity supply services … … … … 6.5% .”

Commencement.
4. This Act shall come into force on the 1st day of April, 2010.

__________ ... … __________


1

Originally Posted By: Bill - General Sales Tax (Amednment) Act 2010 - March 2010
General Sales Tax

BELIZE:
BILL

for

AN ACT
to amend the General Sales Tax Act, (No. 49 of 2005), to increase the rate of tax from 10% to 12.5%; and to provide for matters connected therewith or incidental thereto.
(Gazetted……………, 2010).

BE IT ENACTED, by and with the advice and consent of the House of Representatives and the Senate of Belize and by the authority of the same, as follows:-

1.
Short title.
2. This Act may be cited as the

[align:centerGENERAL SALES TAX (AMENDMENT) ACT, 2010,[/align]

No. 49/05

and shall be read and construed as one with the General Sales Tax Act, which is hereinafter referred to as the principal Act.

Amendment of section 9.
2. Section 9 of the principal Act is hereby amended as follows:-
(i) by renumbering that section as subsection (1);
(ii) in subsection (1), as so renumbered, by substituting the figure “12.5%” for the figure “10%” occurring in paragraph (b) thereof;
(iii) by adding the following as subsection (2):-

“(2) The rate of tax specified in subsection (1) (b) above may from time to time be varied by the Minister by Order published in the Gazette and every such Order shall be subject to negative resolution.”

Commencement.
3. This Act shall come into force on the 1st day of April 2010.

[align:center]__________ ... … __________[/align]

1

Originally Posted By: Bill - CUSTOMS AND EXCISE DUTIES (AMENDMENT) ACT 2010 - 9 Mar 2010
Customs and Excise Duties

BELIZE:
BILL

for

AN ACT
to amend the Customs and Excise Duties Act, Chapter 48 of the Laws of Belize, Revised Edition 2000-2003, to vary the rates of customs duties on certain goods to lower the cost of living; to provide for an excise duty on locally-extracted crude oil; to extend the power of the Minister to remit customs duties in certain cases in the public interest; and to provide for matters connected therewith or incidental thereto.

Gazetted……………, 2010

BE IT ENACTED, by and with the advice and consent of the House of Representatives and the Senate of Belize and by the authority of the same, as follows:-

Short Title.
1. This Act may be cited as the

CUSTOMS AND EXCISE DUTIES (AMENDMENT) ACT, 2010,

CAP. 48
No. 3/02
13/02
1/04
5/05
13/05
19/05
11/08
3/09
7/09


and shall be read and construed as one with the Customs and Excise Duties Act which, as amended, is hereinafter referred to as the principal Act.

Amendment of section 17.
Act No. 11/08

2. Section 17 of the principal Act [as amended by Act No. 11 of 2008] is further amended in subsection (1) thereof by adding the following new item immediately after item (e);
“(f) essential consumable items such as bed linens, towels, carpets imported by small licensed hotel and guest house operators for the running of their businesses.”

Amendment of First Schedule.
3. The First Schedule to the principal Act is hereby amended as follows:
(i) by substituting the following rates of duty for the rates of duty appearing therein opposite the following items:

…/2

New Import Duty Rates: 0%

TARIFF HEADING
and
DESCRIPTION OF GOODS

0602.90.10 Banana plants
0901.21.00 Not decaffeinated
0901.22.00 Decaffeinated
0901.90.20 Coffee substitutes containing coffee in any proportion
1006.10.10 For sowing
1104.12.00 Of oats
1507.90.00 Other
1508.90.00 Other
1509.10.00 Virgin
1509.90.00 Other
1510.00.90 Other
1511.90.90 Other
1512.19.00 Other
1512.29.00 Other
1513.19.00 Other
1513.29.00 Other
1514.19.00 Other
1514.99.00 Other
1515.19.00 Other
1515.29.00 Other
1515.50.00 Sesame Oil and its fractions
1515.90.00 Other
1516.20.00 Vegetable fats and oils and their fractions
1602.49.10 Luncheon meat
1805.00.10 Put up for retail sale in packages of not more than 2 kg
1805.00.90 Other
1901.90.20 Preparations of malt extract
1904.10.00 Prepared foods obtained by the swelling or roasting of cereals or cereal products
1904.20.00 Prepared foods obtained from unroasted cereal flakes or from mixtures of unroasted cereal flakes and roasted cereal flakes or swelled cereals
1904.30.00 Bulgur wheat
1904.90.00 Other
2101.12.00 Preparations with a basis of extracts, essences or concentrates or with a basis of coffee
2101.30.00 Roasted chicory and other roasted coffee substitutes, and extracts, essences and concentrates thereof
2102.20.10 Inactive yeasts
3402.11.10 Put up for retail sale
3402.12.10 Put up for retail sale
3402.13.10 Put up for retail sale
3402.19.10 Put up for retail sale
3917.31.00 Flexible tubes, pipes and hoses, having a minimum burst pressure of 27.6 MPa
4819.10.00 Cartons, boxes and cases, of corrugated paper or paperboard
4819.20.00 Folding cartons, boxes and cases, of non-corrugated paper or paperboard
4819.50.10 Egg boxes and trays
7312.10.20 Cables
8418.10.10 Frost free, electrical
8418.10.20 Other, electrical
8418.10.30 Non-electrical
8426.41.10 Sugar cane loading machinery
8450.11.10 For domestic use
8450.12.10 For domestic use
8450.19.10 For domestic use
8450.20.10 For domestic use
8708.30.10 Mounted brake linings for tractors
8708.30.30 Brakes, servo-brakes and parts thereof for tractors
8708.40.10 For tractors
8708.50.10 For tractors
8708.70.10 For tractors
8708.80.10 For tractors
8708.91.10 For tractors
8708.92.10 For tractors
8708.93.10 For tractors
8708.94.10 For tractors
8708.99.10 For tractors

(ii) by adding the following new Tariff Subheadings:-

TARRIFF HEADING
and
DESCRIPTION
and
MFN

1601.00.10 Chicken Sausages canned;
1601.00.11 Canned Hot-Dog Sausages 0%
1601.00.19 Other 20%
1601.00.20 Other chicken sausages;
1601.00.21 Hot-Dog sausages 0%
1601.00.29 Other 20%
1601.00.40 Other sausages, canned;
1601.00.41 Hot Dog sausages of Pork 0%
1601.00.42 Hot Dog sausages of Beef 0%
1601.00.49 Other 20%
1601.00.93 Hot Dog sausages of Pork 0%
1601.00.94 Hot dog sausages of Beef 0%
1601.00.99 Other hot dog sausages 0%
1602.90.90 Other;
1602.90.91 Potted Meat 0%
1602.90.99 Other 20%
1902.30.00 Other Pasta;
1902.30.10 Macaroni and cheese dinner 0%
1902.30.90 Other 35%
2106.90.90 Other;
2106.90.91 Vitamins and Supplements 0%
2106.90.99 Other 20%
2202.90.90 Other;
2202.90.91 Vitamins and Supplements 70%
2202.90.99 Other 100%
3004.90.90 Other;
3004.90.91 Dialysis fluid 0%
3004.90.99 Other 15%
4202.29.00 Other;
4202.29.10 School Bags 0%
4202.29.90 Other 20%
4820.10.00Registers, account books, note books, order books, receipt books, letter pads, memorandum pads, diaries and similar articles;
4820.10.10 Note books 20%
4820.10.90 Registers, account books, order books, receipt books, letter pads, memorandum pads, diaries and similar articles 20%

4. The Second Schedule to the principal Act is hereby amended
Amendment of Second Schedule.
by adding the following new item immediately after item 5:-

Item No.: 6
Class or Description: Locally Extracted Crude Oil
Unit for Classification: Barrel (of 42 US Gals.)
Unit for Duty: Per Barrel
Rate of Excise Duty: $1.00

Commencement.
5. This Act shall come into force on the 1st April, 2010.

__________ ... … __________
_________________________
Wilfred Rhaburn, CPA
Website: www.consultingbelize.com
E-mail: wrhaburn@consultingbelize.com