What is Goods Tax?

Generally, goods tax is a tax charged by manufacturers and wholesalers when they sell goods by wholesale. Importers pay goods tax directly to Customs.

Goods tax is payable on Goods manufactured and used in Solomon Islands; and Goods, whether new or used, imported for use into Solomon Islands.

Goods Tax is not payable on:

• Services, which do not result in the manufacture of goods.
• Sales of real or intangible property (eg land, copyright, patents etc)
• Second hand goods that have been used in Solomon Islands
• Goods for export
• Goods specifically exempted by the Goods Tax Act

Do I need to Register?

If you are a manufacturer or wholesaler you will need to register with IRD unless you only deal in exempt goods. Importers pay goods tax directly to Customs at the port of entry.

If you are already registered and are just beginning an activity that requires you to register for goods tax you can write to us or complete just the goods tax part of the IR1 Registration Form noting your Tax Identifier Number (TIN) on the form.

When is goods tax charged and how do I calculate it?

Generally goods tax is charged when goods are sold by a manufacturer to a wholesaler to a retailer. However a liability for goods tax can also arise where goods are:

•  Leased
• Imported by retailers for sale
• Imported by a consumer for private use
• Given away for promotional purposes
• Used as samples
• Used in the repair of other goods
• Transferred to stock for sale by retail by a manufacturer

Goods tax is charged on the final wholesale sale, this means the sale from a wholesaler to a retailer. For example if a wholesaler sells goods to a retailer for $100 and the rate of goods tax was 10% then $10 tax would have to be charged. If there is no wholesale sale, for example a manufacturer sells directly to a consumer, then the tax is payable on an amount that is equal to the wholesale price of the goods.

Rates of Goods Tax

Exempt goods include: drugs, medicines and surgical goods, goods used by Governments and charitable organisations, goods designed for use by disabled people, rice.

If I have to charge Goods Tax when do I pay it to IRD and what forms do I use?

If you charge goods tax then you must pay the goods tax to IRD by the 30th day following the month in which it was collected. You must lodge a Monthly Return Form GT3 with your payment.