ANNOUNCED AS TEMPORARYNo
Tax or social insurance relief
On 19 August 2016, the Department of Trade and Industry (DTI) of South Africa issued Notice 504 announcing the approval of an application made by Nyanza Light Metals (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local coating and chemical producer which is deductible from taxable income is ZAR 900 million (USD 66.6 million), and the training allowance is circa ZAR 10.1 million (circa USD 748,000).
The DTI has stated that the manufacturing qualifying assets accounted for the company's total investments estimated at ZAR 5,450 million (USD 403.4 million), and due to the specific characteristics of the project, the DTI classified this investment as a Greenfield project.
The purpose of the investment is to manufacture Titanium Dioxide.
Section 12I Tax Allowance Incentive
The 12I Tax Incentive seeks to promote Greenfield and Brownfield investments with the objective to boost the productivity of the South African manufacturing sector and increase the productivity of the human capital.
The minimum investment required in qualifying assets is ZAR 50 million for a greenfield project (projects that use only new and unused manufacturing assets) and an additional investment of ZAR 30 million for a brownfield project (expansions or upgrades of existing industrial complexes).
The total investment allowance range between 35% and 55% (or ZAR 350 million and ZAR 900 million) depending on the type of the investment, the status classification, and the localization.
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