dividends vary if the receiving corporation has a controlling interest in the Jamaican company, as follows:
Controlling Withholding Tax
Interest Rate on Dividends
Canada 10% 22.5%
Caribbean Community (1) 0 0
France 10 10
Germany (2) 25 15
Israel 10 22.5
Sweden 10 22.5
United Kingdom 10 22.5
United States 10 10
__________
Notes:
(1) Except for Barbados.
(2) To date there have been no amendments to the articles 10-12 of the double tax treaty with the Federal Republic of Germany after the abolition of the additional company profits tax fund against which tax deducted from
dividends could be offset. By mutual agreement or protocol communication, however, the matter can be resolved with proper representation to the governments or courts of Jamaica and Germany.A corporation resident in Germany is subject to a withholding tax rate of 10% on interest payments if the payments are received by a bank recognized as a banking institution under the
laws of that country.
The withholding tax on royalties does not apply if the recipient corporation controls more than 50% of the payor company or has a permanent establishment in the other territory (i.e., Norway, Sweden, the United Kingdom, or the United States).
OTHER SIGNIFICANT TAXES
21. Sales (Value-Added) Taxes
A sales tax is imposed at the retail level on, mainly, goods considered to be luxuries. The tax is paid by the purchaser and is levied only on goods not previously subject to this tax (see item 25, general Consumption Tax?.
22. Inheritance and Gift Taxes
No taxes are levied on gifts or on property passing on death except for real estate and securities. The transfer tax is 7.5% of value.
23. Taxes on Payrolls (Social Security)
National Insurance Scheme. Employers and employees are required to contribute; the maximum annual contributions are J$12,500.00 each for an employer and for an employee. Self-employed individuals contribute a weekly amount of J$120.25.
National Housing Trust. Contributions are required of employers (3% of employees?emoluments) and of employees (2% of emoluments). Self-employed individuals contribute 3% of their net earnings. Expatriate holders of valid work permits are entitled to a refund of their contributions at the expiration of their contract.
Human Employment and Resource Training Program (The H.E.A.R.T. Trust). Contributions are levied on employers at the rate of 3% of payrolls that exceed J$87,000 per year. The contributions are subject to certain tax exemptions.
Education Tax. Contributions are required from employers (3% of employees?emoluments) and employees (2% of emoluments). The employercontribution is deductible. Self-employed individuals contribute 2% of their net earnings.
25. Other Taxes
General Consumption Tax. The General Consumption Tax (GCT) Act, 1991 was enacted in July 1991 and came into effect on October 22, 1991, whereby GCT will be levied at 15% on the supply and on the importation of goods and services. GCT, as a simpler form of taxation, replaces the following taxes
(subject to exceptions below):
q Excise duty;
q Retail sales tax;
q Consumption duty;
q Other selective taxes, such as travel tax, hotel tax, stamp duties, entertainment duty, tax on betting, gaming, and lotteries, motor vehicle licenses, and other forms of licenses.
Instead of the GCT, excise duty and a special consumption tax will be payable on beer, cigarettes, motor spirits, diesel oil, and alcoholic beverages.
Certain goods and services are zero-rated, and others are exempt from GCT.
GCT is charged in the form of an output tax on supplies and accounted for monthly to the Collector of Taxes, GCT. Input tax paid is a tax credit against output tax, and the net balance monthly is payable or refundable, as appropriate. Simplified accounting methods will be introduced to account for the net tax by the taxpayer who will elect one of the options offe
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