Individual incomes are taxed on a graduated scale ranging for single taxpayers from 14% on the first SI $2,100 of taxable income to 42% on taxable income exceeding SI $14,700. Companies incorporated in the Solomon Islands are taxed at a fixed rate of 35%; a rate of 50% applies to those incorporated elsewhere. A value-added tax on telephone services, restaurant food, and overseas travel tickets went into effect in August 1990. Employers contribute 7.5% of employee wages for social security; employees contribute 5% minimum. On 1 July 1990, a resident withholding tax went into effect for royalties, fishing operations, sales of copra and cocoa, and certain other sources of income.
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