Tax Benefits of Operating in a Free Zone:

1. Ownership Flexibility:
   • Both foreigners and nationals can own 100% of the shares without restrictions. This means that Pearl House Ltd’s shareholders alone can own the shares as there are no restrictions on the shareholding structures.
2. Exemption from Import Duties and VAT:
   • Pearl House Ltd would be exempt from Value Added Tax (VAT) and import duties on imports of raw materials and equipment for use in its business operations within the Free Zone.
3. Corporate Tax Exemption:
   • Pearl House Ltd would be exempt from payment of corporate tax for the first 10 years of its operation within the Free Zone. After the initial 10-year period, the company would be taxed at a reduced rate.
4. Reduced Tax Rate on Exports:
   • Exports of goods and services by Pearl House Ltd would be taxed at a rate of 15%, as opposed to the standard 25% rate applicable to the domestic market.
5. Exemption from Withholding Tax on Dividends:
   • Dividends paid to shareholders of Pearl House Ltd would be exempt from withholding tax, providing further tax savings.
6. Input Relief:
   • Pearl House Ltd can obtain inputs for its operations from the national customs-controlled territory that are relieved from Value Added Tax (VAT).
7. Domestic Market Sales:
   • The Free Zone license would allow Pearl House Ltd to sell up to 30% of its goods or services to the domestic market, providing flexibility in business operations. Any faulty goods that do not meet international market standards can also be sold in the domestic market within this 30% allowance.
8. Regulatory Ease:
   • The Customs Division of the Ghana Revenue Authority does not control Free Zone Enterprises but monitors them to ensure they operate within the rules. Additionally, the Free Zone Board facilitates the acquisition of other permits necessary for the operation of Free Zone Enterprises.
9. Business Expansion Opportunities:
   • Operating in the Free Zone environment provides Pearl House Ltd with opportunities for business expansion due to the attractive tax incentives and ease of doing business.