BEZA Incentive Update

Serial Old Incentives Explanation Gazettes Status Serial Old Incentives Explanation Gazettes Status New Incentive Explanation Gazettes Status Remaks 1 to 3 years – 100% 1 to 3 years – 100% 4th year – 80% 4th year – 80% 5th year – 70% 5th year – 70% 6th year – 60% 6th year – 60% 7th year – 50% 7th year – 50% 8th year – 40% 8th year – 40% 9th year – 30% 9th year – 30% 10th year – 20% 10th year – 20% Conditions for S.R.O No. 244-Law/Income Tax-38/2024 Incentives for Developers Incentives for Unit Investors 2 Income tax exemption on dividend for 10 years 100% Exemption 1 Income Tax exemption of varying degree for 12 years SRO No 227-Law/Income Tax/2015 Date: 08 July, 2015 of Internal Resources Division 1st 10 years – 100% 11th year – 70% 12th year – 30% Effective from 01-07-2024 SRO No 299/Law/Income Tax/2105 Date: 8 Oct, 2015 of Internal Resources Still Effective Canceled from 30-06-2024 Still Effective BEZA Incentive Update Same as previous S.R.O No. 244-Law/Income Tax- 38/2024 2 Income tax exemption on dividend for 10 years 100% Exemption SRO No 299/Law/Income Tax/2105 Date: 8 Oct, 2015 of Internal Resources Still Effective 1 Income Tax exemption of for 10 years SRO No 159-Law/Income Tax- 34/2024 Date: 30 May, 2024 (a) The entity must be approved by the National Board of Revenue subject to the following conditions: (i) It must be registered as a new company under the Companies Act, 1994 (Act No. 18 of 1994) and shall not be a unit of any existing company; (ii) It shall not operate as a result of restructuring, merger, or demerger of an existing business; (iii) It shall not use any machinery, equipment, etc., previously used for the production of goods or provision of services in any industrial unit within the said economic zone; 3 Exemption from Income Tax on the income of expatriate for 3 years 50% Exemption SRO No. 298- Law/Income Tax/2015 Date: 8 Oct, 2015 of Internal Resources Division Still Effective (d) Failure to comply with any of the conditions or terms mentioned in this notification shall result in the withdrawal of approval by the National Board of Revenue; (e) The provisions of subsections (5) and (6) of section 76 of the Income Tax Act, 2023 (Act No. 12 of 2023) and other relevant provisions shall apply; (f) If any environmental law violation is imposed by any authority of the government on the entity within any fiscal year, the entity shall not be eligible for exemption under this notification for that fiscal year; and (g) No exemption benefit shall be available under this notification if the establishment fails to commence commercial operations by June 30, 2035. (iv) It shall not operate any industrial unit outside the said economic zone and shall be entirely located within the said economic zone; (v) It shall not operate as a commercial entity or trading company; (vi) It shall be recognized by the Board as an eligible industry for exemption. (b) Establishments engaged in the production of consumables such as edible oils, sugar, flour, etc., and cement, iron, and steel products within the said economic zone shall not be eligible for the benefits under this notification. (c) The entity shall be eligible for reduced tax rates from the year of commencement of commercial operations to the tenth year thereafter;