Corporate tax for resident and non-resident companies since the 2012 income tax year is 20%, with companies listed on the South Pacific Stock Exchange paying 10%.
The top marginal personal tax rate is 20%, taking effect at assessable income levels above F$50,000 for residents and from the first dollar of income for non-residents. No income tax is payable on incomes less then F$16,000.
In addition, Social Responsibility Tax (SRT) applies to both tax residents and non-residents earning in excess of F$270,000. The additional rates applying on the excess income range between 23% and 29%.
Fringe Benefit Tax (FBT)
Employers are required to pay fringe benefit tax on benefits provided to employees at 20% of the value of the benefit. The “benefits” covered by FBT are wide-ranging.
Effective 1 January 2016 the dividends regime has been simplified. Imputation credits for dividends paid out of fully taxed corporate income will no longer be available. Dividends paid to local shareholders are required to be withheld at 3%, while dividends paid off-shore are withheld at 9%.
Withholding tax on, interest, royalties and management fees paid to non-residents apply at rates varying between 10 and 15% depending on the nature of the payment and the jurisdiction to which payment is being remitted (because of double tax arrangements).
Fiji has also imposed a miscellaneous “services” withholding tax which applies to payments for a professional and independent service providers at 15%. Corresponding tax credit in the recipient’s jurisdiction, even in states with double tax arrangements with Fiji, may not be available for this withholding tax.
Capital Gains Tax (CGT)
CGT of 10% is payable on gains made on the disposal of capital assets (including land and buildings, aircraft, ships exceeding 100 tonnes, shares, intangible assets and options relating to such assets) by residents on local and foreign assets. A credit is allowed for foreign tax paid on the disposal of those assets. Non-residents are required to pay CGT on Fiji assets. CGT effectively taxes transactions (it is not an income tax) and no indexing is applied for assets acquired before 2011.
Value Added Tax (VAT)
VAT is charged on supplies of goods and services including imports at the rate of 9% (reduced from 1 January 2016). Certain supplies are exempt. Other supplies, including those in the nature of exports, are zero-rated. Fiji’s Value Added Tax Decree 1991 is similar in concept to, but not identical to New Zealand’s Goods and Services (GST) legislation.
Service Turnover Tax (STT)
STT applies at a rate of 10% (increased from 1 January 2016) on provision of services such as accommodation including home stays, meals, beverages, live entertainment and cinema tickets as well as hire of rental cars and tours. The provider of the services must account to the tax authorities for this tax.
A corresponding Environmental Levy of 6% also applies to the provision of services subject to STT.
Customs and excise duties
Most imported and some domestically manufactured goods are subject to these duties. Charged goods fall into one of five duty bands ranging between 5% and 32%.
This is charged on a range of written instruments mainly transfers and leases of land, finance and security documents. Transfer duty on key instruments is charged at the rate of 3% on the consideration paid for real property and share transfers. Loan agreements (including intercompany advances), mortgages and other security instruments are subject to 1.75% duty on the principal sum secured.
Non-resident purchasers of residential property are subject to stamp duty of 10% on the consideration paid for real property, and 5% stamp duty on the principal sum secured under any mortgage.
From 1 January 2016, 5% of any payment under:
- a contract of service to an independent contractor or
- an agreement to pay commission;
must be deducted and paid to FRCA, unless the sum of payments annually does not exceed F$1,000.
Double Tax Agreements
Fiji has entered into Double Tax Agreements with the following states:
- United Kingdom
- New Zealand
- South Korea
- Papua New Guinea
- United Arab Emirates