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Samoa

 
   
Executive Summary
The Independent State of Samoa is the sovereign country located in the Pacific Ocean in the Western part of the Samoa Islands. These islands were known as Navigators Islands prior to the 20th century thanks to the local population’s seafaring knowledge and skills. Today the country covers a total area of 2,831 sq km.

Apia is the capital of Samoa; Samoan and English are its official languages. It is a parliamentary republic. After Samoa has obtained independence from New Zealand, its constitution came into force in 1962, and the political model of today is largely based upon the UK system. Legislative power belongs to Fono – the unicameral parliament, which appoints the Prime Minister, who in his turn is the head of the government.

Agriculture is the main economic activity of Samoa, employing roughly 65% of the population and ensuring 90% of exported goods. The major part of the country’s territory has fertile souls, and due to the difference in the altitude, diverse products can be cultivated. Coconut cream, coconut oil and copra are main agricultural products and their derivates, used for export purposes. Tourism is rapidly growing in the last year and now brings approximately 25% of the GDP. Moreover, government has introduced a number of financial incentives, in order to attract international investors.

The Tala (WST) is the official currency of Samoa.

Geography
New Zealand and Hawaii are the neighbour states of Samoa.  The largest two islands, Upolu and Savai’i plus eight smaller islands constitute the country. The territory of Samoa has a volcanic origin, but only Savai’i is still volcanically active. Magua Silsili, which rises at 1,858 metres above the sea level, is the highest point of the country.

Samoa has a tropical climate; +26,5 degrees C is the average annual temperature.

Map, Flag and Coat of Arm
 


Types of Company

International companies incorporated under the Act of 1987 are not liable to paying taxes, and may have the following forms: company limited by shares, limited by guarantee, hybrid company, LLC, international trust, limited liability partnership, segregated fund international company, creditor controlled company. International companies follow a separate legislation from local companies regulation.  The information represented below describes international companies, which are particularly attractive to international investors.

Company Limited by Shares
Shares of no par value and partly-paid shares are permitted. The capital may be expressed in any currency, excluding the Tala. At least one shareholder may incorporate a company. At least one director and one secretary must be appointed, they may be private persons or corporate entities. Annual meetings and submission of annual returns is not are not obligatory requirement. It is possible to redomicile a company to and from Samoa, following a precisely outlined procedure.

Company Limited by Guarantee
The liability of company’s members is limited by guarantee.

Hybrid Company
The liability of company members is limited by shares and guarantee. A shareholder need not have a limited liability by guarantee in addition to shares, and vice versa.

Limited Life Company (LLC)
This type of company is based on the US-model. Usually such a company ends its existence when certain conditions are realized. At least two members may incorporate this type of company.

Creditor Controlled Company
This type of company does not issue any type of hares. Paid-up capital need not be issued. There are no members in this type of company.

Segregated Fund International Company
This is a protected cell company.

Branch of a Foreign Company
A foreign company which wishes to be managed from Samoa must be registered on the territory of the country, by submitting all the required documentation.

Limited Liability Partnership
At least two entities can create a limited liability partnership. A general partner has unlimited liability to partnership’s debts and obligation, while a limited partner’s liability is limited up to the capital invested into the structure.

Captive Insurance
A captive insurance company may be established in Samoa. A minimal issued share capital of an insurance company should be USD 500,000. In order to incorporate such a company, a detailed information on financial standing, shareholders and references should be provided to the government authorities. A registered insurance company should have its registered office and a principle place of operations in Samoa at all times. An auditor must be appointed and financial statements must be submitted to the Registrar on the annual basis.

International Trust
At least one trustee must be an international business company or a foreign company and all the trust’s beneficiaries must be non-residents. Samoan trust law is largely based upon English trust law. An international trust does not need to file annual reports and accounts.

Taxation

Personal
Personal income tax has a scalable nature. The first WST 10,000 are exempt from tax, 10%, 20% and 29% are levied on income that exceedsa certain amount of money earned in a tax year. This tax is applied to resident and non-resident private persons.

Corporate
Resident companies are liable to pay corporation tax at a rate of 29% on their world-wide income. Non-resident companies pay corporation tax solely on income derived from activities conducted in Samoa. There is a specific taxation regime for insurance companies. No withholding tax on dividends is levied. However, withholding tax rates on interests vary from 10% to 15% on different occasions. Capital gains tax is levied at a rate of 30%.

Goods and services tax (VAGST) is levied at a rate of 12.5%, but it is not charged on a number of items such as fish, fruits, vegetables, water, medicine and others. Excise duty is applied to petrol, alcohol, tobacco, soft drinks and some categories of motor vehicles. Stamp duty is levied at various rates depending on the transaction.

All the international companies registered for offshore business purposes are exempted from any direct taxes and stamp duties.

 
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