What is the export processing zone?

Export processing zone is an area in which the government provides exporters incentives to find its business. The country can try to increase the growth of export and attract foreign investment in the zone. To achieve this goal, the government can provide sophisticated infrastructure and offer factory and office space for favorable rental rates. There may be a customs and indirect tax relief for materials and equipment imported into the zone and direct tax incentives for receiving goods balanced from the zone. There could be a limitation of types of activities permitted in the zone and the license would be necessary for businesses that would like to find their operations there. Information about such zones is usually available from the country's investment authority, which can also help foreign companies fissaling and registration to the zone. The websites of the relevant investment authorities may be consulted to find that the types of business allowed in zones, available infrastructure and premises and all offered exceptions and TaxLevách.

businesses operating in the export processing zone may be entitled to an exception to the customs obligations for goods and equipment imported into the export production zone. Such exceptions are generally paid only when the goods remain in the zone and if the goods are transported from the zone to the rest of the country, the exception will be lost. Exemption from sales tax or added value (VAT) may be available on imported materials and the goods exported from the zone will often be evaluated for VAT purposes, allowing the company to require any VAT to return to inputs.

Tax exemption available in the export processug zone is sometimes dependent on the contribution that a foreign company will contribute to the local economy. For example, exceptions may depend on the number of local employees who will be employed and the extent that the materials will be obtained from local suppliers. Different levels of exceptions can be to dDepending on the size of the contribution that a foreign company contributed to the local economy. The income tax relief will usually be available only for export sales and any goods sold will be susceptible to income tax as usual.

Export processing zone will often be administered by the independent Office for Export Processing (EPZ Authority), which will assess applicants' businesses and issue licenses. Licenses will usually be issued for specified types of activities, such as manufacturing or processing companies, depending on the types of exports that the government is trying to promote. The EPZ Office should normally cancel the licenses when businesses are violated.