R&P Tax Alert – New announced tax amendments for international service providers in Suriname

This week the Suriname Parliament passed a change in the current Turnover Tax Act regarding the rates for the delivery of goods and the provision of services. A general rate for turnover tax of 12% (from respectively 10% and 8%) will be applicable for both the delivery of goods and the provision of services.

During the deliberations in Parliament of the amendment of the Turnover Tax Act, the Minister of Finance also made several other important tax announcements. These announcements mainly relate to the tax position of international service providers.

The first announcement regards an introduction of a Withholding Tax (WHT) on payments made to international service providers in Suriname. It is yet unclear what the exact implementation date of this new WHT will be. However, the Minister of Finance announced that this will be in short.

The new withholding tax will be a pre-levy to the corporate income tax and will also apply to services provided in the Exclusive Economic Zone (offshore) of Suriname. The Minister of Finance mentioned for example the Suriname Oil & Gas Sector. Contractors within the Oil & Gas sector purchasing services from subcontractors must withhold taxes and remit these taxes to the Suriname Government. A percentage of 15% for withholding tax is mentioned. As the withholding tax will be an advance payment on the corporate income tax, the subcontractor can on his behalf refund the withholding tax, when filing their corporate income tax return for the concerning year.

The second tax amendment which is announced is the extension of the fiscal jurisdiction to the EEZ of Suriname. Benefits currently enjoyed by foreign companies active within the EEZ will unfortunately be eliminated. This means that wage taxes will apply to all employees working in the EEZ. Also, turnover tax will apply to services provided within the EEZ.

Unfortunately, the Minister of Finance did not make any further details available yet regarding the new tax amendments for international service providers.

R&P will closely follow these developments and notify you when more details are made available. If in the meantime you have any questions regarding the above, please do not hesitate to contact us.