New proposals receive the thumbs-up from Cabinet |19 December 2020
PS Choppy
In the absence of President Wavel Ramkalawan who was on overseas mission, the meeting of the Cabinet this week was chaired by Vice-President Ahmed Afif and at which a number of legal and policy memoranda were considered.
Firstly, the cabinet approved for the signing of the Framework agreement between the French Embassy, Universities in Reunion and the University Hospital of Reunion on the one hand and the department of health and the University of Seychelles on the other hand.
Cabinet also approved the Broadcasting and Telecommunications (Per-second Billing by Operators of Public Land Mobile Network).
Benjamin Choppy, the principal secretary for information communications technology explained that prior to the new regulation and approval, local consumers were being billed on a per-minute basis.
He noted that the service providers will have a delay of six month to apply the new billing method after it has been published.
PS Choppy mentioned the introduction of a new type approval fee to be levied for each radio-communication equipment to be type approved by the Department of Information and Communication Technologies (DICT), which was also approved by the Cabinet.
Type approval or certificate of conformity is granted to a product that meets a minimum set of regulatory, technical and safety requirements. Generally, type approval is required before a product is allowed to be sold in a particular country, so the requirements for a given product will vary around the world.
Mr Choppy added that the new fee will be around R600 and all the revenue will be pocketed by the finance department.
The equally approved amendments in the legal framework for the Joint Management Area (JMA) of Extended Continental Shelf in the Mascarene plateau Region between Seychelles and Mauritius.
On March 30, 2011, the United Nations Commission on the Limits of the Continental Shelf (CLCS) adopted recommendations confirming the outer limits of the continental shelf of the Republic of Mauritius and the Republic of the Seychelles beyond 200 nautical miles in the Mascarene Plateau region.
Subsequently, in March 2012 the two coastal States agreed, through the adoption of a bilateral Treaty instrument, to the creation of a Joint Management Area (JMA) where the two States will exercise sovereign rights jointly for the purpose of exploring the continental shelf and exploiting its natural resources (the Joint Zone Treaty). A further bilateral Treaty instrument was also signed which details the administrative and management functions, powers and duties for the JMA (the JMA Management Treaty).
The JMA covers an area of 396,000 sq. km extending seaward to the east beyond the existing EEZs of both coastal States and is the largest joint maritime zone to have been established anywhere in the world.
Senior Legal Officer at the Blue Economy Department Estelle Lucas explained that since there has been a change of National Assembly and Cabinet, they have been advised to re-submit the paper for approval, thus getting the permission to work on a new legal framework and Act, involving all the terms and conditions of the bilateral, including all the subsequent legislations involved.
Cabinet also approved amendments to the Revenue Administration (Filing of Business Activity Statement) Regulation to incorporate three new forms namely the amended Business Activity Statement (BAS) form attached with the Withholding Tax Remittance form and the List of Donations for Corporate Social Responsibility Tax (CSRT) form.
These amendments would contribute to an improved business development environment.
Selina Verghese, the director general for Tax and Financial Sector Policy, said the amendments cover two areas – withholding tax on remuneration paid to non-resident entertainers and sports person and the sugar tax.
Withholding Tax is the method used to collect taxation and it involves the payer withholding tax from the gross payments made to the payee. The payer then remits this the amount withheld in their monthly Business Activity Statement (BAS).
She also gave technical explanations regarding the approved amendments under the First Schedule of the Business Tax Act 2009 and the amendments to Schedules 4 and 5 of SI 1 of 2015 Revenue Administration (Common Reporting Standard) Regulations.
The Common Reporting Standard (CRS) is an information standard for the Automatic Exchange Of Information (AEOI) regarding financial accounts on a global level, between tax authorities, which the Organisation for Economic Co-operation and Development (OECD) developed in 2014.
Its purpose is to combat tax evasion.
The idea was based on the US Foreign Account Tax Compliance Act (FATCA) implementation agreements and its legal basis is the Convention on Mutual Administrative Assistance in Tax Matters.
To date, 97 countries have signed an agreement to implement it, with more countries intending to sign later. First reporting occurred in 2017, with many of the rest starting in 2018.
Finally, Cabinet approved the creation of a fish processing zone on Ile du Port.
Special advisor for Fisheries Roy Clarisse said since there is proof of more potential in processing fish locally, or added value, rather than exports, the authority found it necessary to identify an area dedicated to fish processing only.
He explained that due to the shortage, or limitation of land, they found it necessary to identify a piece of land close to the sea which is ideal for such development.
Mr Clarisse further added that it is important to have all the related activities in one particular area.
Cabinet also approved for the moratorium placed on the importation of motor vehicles to be reviewed.
The proposed policy would discourage the importation of motor vehicles until the national economic situation improved.
Principal secretary for Trade Cillia Mangroo explained that the moratorium will be removed as from January 1, 2021.
She however added that a temporary 25% excise tax will be included on the importation of vehicles, based on the impact the activity will have on the flow of foreign exchange.
The excise tax will be for one year, with the possibility of changes based on the foreign exchange situation.
Roland Duval
Photos: Thomas Meriton
