InTouch with indirect news

Caribbean Region – Alert

pwc InTouch with news Caribbean Region Alert

In this issue: PricewaterhouseCoopers Caribbean Region is pleased I Antigua & Barbuda – Budgetary proposals legislated ...... 3 to present the August 2010 I Aruba – BBO rate reduced...... 5 issue of InTouch, a bulletin I Barbados – Reforms to Barbados VAT ...... 7

I Curaçao, Bonaire, St. Maarten, Saba, St. Eustatius...... 9 designed to keep our clients

I Dominica ...... 10 up-to-date with regional

I Grenada – VAT in Grenada effective February 1, 2010 ...... 11 indirect taxation.

I Jamaica – Increase in rate of GCT...... 12

I St. Kitts and Nevis – VAT proposed implementation ...... 14

I St. Lucia – Proposed introduction of VAT delayed...... 15

I Trinidad & Tobago ...... 16

I Contacts...... 17

2 pwc Antigua & Barbuda

Updates and developments An overview Rates

2009 saw the rate of Antigua and Barbuda Sales Antigua and Barbuda (“ABST”) is the The following rates of tax are applicable under the Tax (“ABST”) applicable to gambling supplies name given to a value added type tax that ABST regime: (see Rates) changed to 10%, for gambling was introduced in Antigua and Barbuda from I a zero rate applicable to scheduled goods and supplies made from the inception of ABST through January 29, 2007. services; January 28, 2009. The standard rate of 15% remains applicable to subsequent The ABST is levied on local consumption, and I a ‘transitional’ rate of 10.5% which is gambling supplies. The amendments to is intended to be borne by the consumer, having re- currently being applied to hotel or holiday gambling operations have not been made. placed several other consumption . accommodation; and The tax is administered by the Commissioner Based on the 2010 budget proposals put forward of Inland Revenue, supported by the Inland I a standard rate of 15% applicable to all other by the government on November 30 2009, (legis- Revenue Department. taxable supplies and imports. lated March 11, 2010) the scope of items in the ‘basket’ of zero-rated The Customs & Department collects ABST In addition to the foregoing, there was also a delimited goods has been reduced to include only payable on imports on behalf of the transitional rate of 10% levied on gambling supplies the following items from January 1, 2010: chicken, Commissioner. made during the first two years of ABST (i.e. up fish, milk, butter, eggs, fresh fruits and vegetables, until January 28, 2009). Supplies thereafter are rice, flour, cornmeal, cereal, cooking oil, shortening Generally, registration is required of persons who subject to the standard rate of 15%. and margarine, bread, yeast, water, medicine (such have made or are likely to make supplies to the as aspirin, paracetamol and cough medicine), value of EC$300,000 in a continuous period of sugar, salt, tofu, soya milk and soya chunks, dia- twelve calendar months. pers (babies and adults) and baby formula for food.

I ABST Antigua & Barbuda Sales Tax

pwc 3 L Contents Antigua & Barbuda

A taxable person for the purposes of ABST is a I education; Customs is levied on goods based on the cost, person (individual, corporate or otherwise) who is I long-term accommodation ( over 45 days); insurance and freight ("CIF") values and rates deter- registered or required to be registered so as to I prescription medicines, medical and similar mined by the Caricom Common External Tariff. collect and pay ABST. Taxable persons are required services, and veterinary services; to file returns of relevant information and pay ABST I unimproved/agricultural land; Antigua and Barbuda Revenue Recovery Charge to the Commissioner of Inland Revenue on a I unprocessed agricultural products; is applied at a rate of 10% on the CIF value on all monthly basis. I agricultural/fishing inputs; goods imported into or produced in Antigua I domestic postal services; and and Barbuda. Exemptions will include entities Government entities and similar bodies which I local entertainment. with which the Government has International supply goods and services for a fee or carry Assistance Agreements , certain Government out business-type activities, promoters of public Customs Duties entities and most supplies or imports of fuel. entertainment, and suppliers of certain types of professional services, are all required to be All imports are subject to import duties, ABST, The Environmental Levy is calculated based on registered regardless of whether or not they Antigua and Barbuda Revenue Recovery Charge dollar value rates from $0.25 - $2,000 and is used reach the registration threshold noted above. and an environmental levy. In all instances certain to the cost of protecting and preserving exemptions apply. the environment. Supplies and imports of the following items are exempt from ABST: Import duty is levied on a wide range of imported I local transportation; goods at rates from 0% to 70% specified in the I financial services; Custom Duties Act. I residential premises (except where zero-rated);

Contacts: Address: Charles Walwyn Neil M. Coates Tel: (268) 462-3000 11 Old Parham Road Managing Partner Director Fax: (268) 462-1902 P.O. Box 1531 [email protected] [email protected] Direct fax: (268) 462-3756 St. John’s, Antigua Website: http://www.pwc.com/ag

pwc 4 L Contents Aruba

Updates and developments Goods, services and payment Exemptions

Turnover tax in Dutch “Belasting op bedrijt- Goods are defined as all physical objects including Some exemptions are applicable: Companies somzetten” (“BBO”) - due to the election of a new water, gas and electricity. Services are defined as exporting goods from Aruba are exempt from BBO. Government in Aruba, it was proposed all services rendered against a payment. A payment The company has to establish that the goods sold to amend the turnover tax legislation to reduce the is defined as all income received relating to the sale are being sent or transported to a destination BBO rate from 3% to 1.5% effective of a good or the rendering of a service. If the in- outside of Aruba by the entrepreneur. No BBO is January 1, 2010. come is non-monetary, the fair market value should levied on the supply of immovable property if in be taken into account. relation to this supply is due. Exemp- BBO on was abolished effective June 1, tions also apply in the following instances: 2010. In cases where goods are sold, the taxable event I supply of prescription medicines occurs either where the transportation commences including certain medical aids; Turnover tax (if goods are sold to or from abroad and transported I renting out of apartments or hotel rooms; in connection with the supply) or where the goods in as far as room tax is due; Every company that sells goods or renders a are physically located. I providing the opportunity to gamble, in as service against a payment in Aruba is subject far as gaming tax is due; to turnover tax. The taxable base consists of all In the case of services, the service is rendered I renting out of real estate that is used as a remunerations received by the company for the at the place where the company providing such is private dwelling; supply of goods or the rendering of services. established or has a . I investment income, such as interest and The BBO rate is set at 1.5%. dividends; I qualified banking transactions; I insurance services and the services performed by intermediaries of insurance companies; I transitional expenses, in as far as the supply of the goods or rendering of the service is done on behalf of and for risk and account of another entrepreneur; and I of goods and services by a company established in the free zone.

I BBO – Turnover Tax I Import Duties

pwc 5 L Contents Aruba

Fiscal Unity Important dates

A parent company that owns 100% of the shares in The BBO return should be filed monthly, no later a subsidiary can request to enter into a Fiscal Unity than the 15th day of the calendar month following for BBO purposes. Fiscal unity facilitates the the calendar month for which the BBO is due. taxation for BBO purposes at the level of the ultimate parent company. The turnover generated Import duties by intercompany transactions is exempt from BBO. Import duties are levied according to a tariff, which The BBO is levied on a cash basis. However, upon is a percentage of the CIF-value of the product. request, the company may opt to apply the invoice A classification rule has been published in which method. Upon approval of the tax authorities, the the various products are categorized into groups. invoice should meet certain requirements. The tariff varies from 0% to 50%.

Contacts: Address: Hans Ruiter Jourainne Wever Tel: (297) 522 1647 L.G. Smith Boulevard 62 Tax Partner Assistant Tax Manager Fax: (297) 582 4864 P.O. Box 307 [email protected] [email protected] Oranjestad, Aruba Website: http://www.pwc.com/aw

pwc 6 L Contents Barbados

Updates and developments Rates Customs Duty

The government has undertaken a VAT reform VAT is levied at the rate of 15% on the value Customs duty is levied on a wide range of initiative in which legislative and administrative of a wide range of goods and services imported goods at rates specified in the aspects of the VAT system in Barbados are being imported or supplied in Barbados by VAT Customs Act. Barbados’ Customs Tariff is based reviewed. The updates are scheduled to be com- registered persons. A number of services, on the Common External Tariff of the Caribbean pleted during 2011. including financial services, real estate, Common Market (Caricom). Customs duty is calcu- medical services, and education, are exempt. lated on either an “ad valorem” basis or at specific An overview Intergroup transactions are taxable. quantitative rates.

Persons operating under Barbados’ VAT regime Certain supplies are zero-rated, including The ad valorem rates for most items vary must be registered for VAT. The threshold for VAT exports, basic food items, prescription drugs, crude between 0% and 20%, but certain goods registration is BDS$60,000, but voluntary oil, and the supply of certain items to the interna- regarded as luxury items are subject to higher registration is permitted for persons whose tional financial services sector, e.g. legal and ac- rates. In addition, a select group of items that are annual turnover is less than BDS$60,000. counting fees. produced within Barbados and Caricom are subject to a duty rate of 60% when imported from outside Every registrant shall within 21 days after the end of There is a concessionary rate of 7.5% the region. each taxable period, whether or not he makes a applicable to the supply of accommodation taxable supply during the taxable period, file a VAT by guest houses, hotels, inns, or any similar place, Manufacturers and agriculturists, including return with the Comptroller. including a dwelling house normally persons involved in fishing and horticulture let or rented for use as a vacation or holiday home. are exempt from the payment of duty on Late filing, late payment penalties and interest inputs imported for use in their businesses. charges apply.

I VAT – Value Added Tax I Customs Duty I Excise Tax I Environmental Levy

pwc 7 L Contents Barbados

The various departments and institutions, Environmental Levy international bodies and organisations listed in Part II-B of the Customs Tariff are exempt from the pay - An environmental levy is in force in Barbados and ment of customs duty. Specific goods (e.g. com - its main purpose is to defray the cost of the puters), also mentioned in Part II-B, are exempt disposal of refuse generated by the use of goods from customs duty. imported into Barbados.

Excise Tax The general rates are either 2% or 3% of the CIF value of all goods, both imported and local, Excise taxes existed in Barbados prior to the but some items are subject to specific rates. introduction of VAT in 1997, but these were There are exemptions from the payment of confined to products of the rum industry. From this levy, including those organisations listed in January 1, 1997, four categories of goods be - Part II-B of the Customs Tariff, the international came subject to excise taxes. These are motor financial services sector, manufacturers and vehicles, spirituous beverages and tobacco the diplomatic corps. products.

Most excisable goods are subject to the tax at a specific rate, with the exception of motor vehicles, which are subject to ad valorem rates. Very few items are exempt from excise taxes. These include motor vehicles imported by the diplomatic corps, and other organisations exempt from customs duty under Part II-B of the Customs Tariff.

Contacts: Address: Russ Jones Ronaele Dathorne Tel: (246) 626 6700 The Financial Services Centre Tax Partner Partner Tax and Corporate Services Fax: (246) 430 9231 Bishop’s Court Hill [email protected] [email protected] St. Michael Barbados Gloria Eduardo Louisa Lewis-Ward Website: http:/www.pwc.com.bb Tax Partner Tax Director [email protected] [email protected]

pwc 8 L Contents Curaçao, Bonaire, Saba, St. Eustatius, St. Maarten

An overview The difference between the two taxes is that The BBO is levied on a cash basis. However, the turnover tax is a tax levied on the entrepreneur, upon request the entrepreneur may opt to apply Turnover tax (“BBO”) and Sales tax (“OB”) whereas the sales tax is levied on the consumer. the invoice method. The OB is levied based on the invoice. In the island territories of St. Maarten, Saba With regard to both the OB and the BBO, exporting and St. Eustatius, every company is subject goods to buyers residing or established outside The OB or BBO return should be filed monthly. to turnover tax, in Dutch “Belasting op of these “levy territories” is exempt from tax. The bedrijfsomzetten” (hereinafter: BBO) on its entrepreneur has to prove that the goods sold are The OB or BBO is due within 15 days of the revenues realized from the sale of goods and being sent or transported to a destination outside calendar month following the calendar month for services. of the OB or BBO territory. which the tax is due. A tax return must be filed with the tax authorities together with payment of the The taxable base consists of all revenue Some exemptions are applicable. For example no amount due. received by the entrepreneur for the supply of OB or BBO is levied on the sale of immovable goods or the rendering of services. The BBO property, if on the transfer of the title, transfer tax In the island territories of Curaçao and Bonaire, is applied at a rate of 3%. has been paid. import duties are levied. The tariff is a percentage of the CIF-value of the product. Sales tax (“OB”) A Fiscal Unity (see page 6) is not applicable with regard to OB and BBO in the Netherlands Antillies. A classification rule has been published in which In the island territories of Curaçao and Bonaire, The turnover generated by intercompany transac - the various products are placed into groups. Tariff every company is obliged to add a sales tax, in tions is therefore subject to OB and BBO. However, rates are then applied to each group. The tariff Dutch “Omzetbelasting” (hereinafter: OB) to the under strict conditions, an exemption applies in varies from 0% to 35%. sales price, on the sale of goods and services. case of shared expenses, where one company The OB rate is 5%. pays certain expenses for its benefit, and that of No import duties are levied in the island territories one or more other companies and charges the of St. Maarten, Saba and St. Eustatius. other companies for their share of said expenses.

Contacts: Address: Steve Vanenburg Arne Kattouw Tel: 599 9 430 0000 Julianaplein, Willemstad, Curaçao Tax Partner Head of Tax Technical Office Fax: 599 9 461 1119 Netherlands Antillies [email protected] [email protected] Website: http://www.pwc.com/an

I BBO – Turnover Tax I OB – Sales Tax I Import Duties

pwc 9 L Contents Dominica

Updates and developments Late filing, late payment penalties and interest General importations are subject to VAT, excise tax, charges apply. a customs service charge, and environmental The recently re-elected government of Dominica surcharge and import duties. In all instances has indicated that there will be no increase in the VAT is levied at the rate of 15% on the value of a certain exemptions apply. rate of VAT in 2010. wide range of goods and services imported or supplied in Dominica by VAT registered persons. Import duty is levied on a wide range of An overview A number of services, including financial services, imported goods at rates from 0% to 165% speci - real estate, medical services, and education, are fied in the Customs Duty Act. The VAT regime in Dominica, introduced in 2006, exempt. Intergroup transactions are taxable. is administered through the Inland Revenue Customs duty is levied on goods based on the CIF Department (Customs & Excise Division administer Certain supplies are zero-rated, including fuel, flour, values and rates determined by the Caricom Com - VAT on importations). milk, rice, and sugar. mon External Tariff. Some exemptions are available for among others, imports of Caricom origin. Every person who carries on a taxable activity and There is a concessionary rate of 10% applicable to is not registered, is required to apply for registration the supply of accommodation by guest houses, The environmental surcharge is calculated based within 21 calendar days of the end of any period hotels, inns, or any similar place, and on accommo - on the CIF value at rates of 1% to 1.5%. Dollar of 12 or fewer months, where during that period dation services in an apartment or room with value rates from EC$10.00 to EC$3,000.00 also the person made taxable supplies, of more than utilities and furnishings provided by the lessor. apply to some items. EC$60,000 for hotel/guest accommodations, and EC$120,000 for other taxable business activities. VAT on importations is charged at a rate of 15% for A Customs Service Charge is levied at 3% on all most goods based on the cost, insurance and goods, calculated based on the CIF value. Every registrant shall within 20 calendar days after freight (CIF) value plus the import duty, environmen - the end of each taxable period (each calendar month), tal surcharge, customs service charge and excise An excise tax is applied at various rates to alcoholic whether or not he makes a taxable supply during the tax. beverages, tobacco products and motor vehicles, taxable period, file a VAT return with the Comptroller. among others.

Contacts: Address: Richard Peterkin Claudette Rawlins Tel: (758) 452 2511 PricewaterhouseCoopers Centre Assurance, Tax & Manager Fax: (758) 452 1061 Point Seraphine, P.O. Box 195, Services Partner [email protected] Castries, St. Lucia [email protected] Website: http://www.pwc.com/lc

I VAT – Value Added Tax I Customs Duty I Import Duty

pwc 10 L Contents Grenada

Updates and developments Late filing, late payment penalties and interest Exempt supplies include financial, insurance and charges apply. educational services, marine and docking services VAT was first implemented in 1986 in Grenada. and international transport. However, this effort was short lived and the VAT is levied at the rate of 15% on the value of a tax has been implemented for a second time wide range of goods and services imported or The General , the Airline Ticket commencing February 1, 2010. supplied in Grenada by VAT registered persons. Tax and Motor Vehicle Purchase Tax have been A number of services, including financial services, repealed but the Customs Service Charge (CSC), An overview real estate, medical services, and education, are Common External Tariff (CET), Environmental Levy exempt. Intergroup transactions are taxable. (EVL) and all other taxes have remained. The VAT is administered through the Inland Revenue Division (Customs & Excise Division Certain supplies are zero-rated, including flour, milk, administer VAT on importations). The threshold rice, and sugar, infant preparations, the supply of for VAT registration is EC$120,000. Registration is water and electricity to domestic users (restrictions also required where during any month the average apply), and fuel. monthly value of taxable supplies is EC$10,000 or more. Voluntary registration is also permitted. There is a concessionary rate of 10% applicable to the supply of accommodation and dive activities. Every registrant shall within 20 calendar days after the end of each taxable period (each calendar VAT on importations is charged at a rate of 15% for month), whether or not he makes a taxable supply most goods, based on the CIF value, plus the im - during the taxable period, file a VAT return with the port duty, environmental surcharge, customs service Comptroller. charge and excise tax.

Contacts: Address: Richard Peterkin Claudette Rawlins Tel: (758) 452 2511 PricewaterhouseCoopers Centre Assurance, Tax & Corporate Tax Manager Fax: (758) 452 1061 Point Seraphine, P.O. Box 195 Services Partner [email protected] Castries, St. Lucia [email protected] Website: http://www.pwc.com/lc

I VAT – Value Added Tax I Customs Duty

pwc 11 L Contents Jamaica

Updates and Recent Developments The AGP is however available as a credit in General accordance with Regulation 14 to the GCT Act, In keeping with its overall goal of reducing the which deals with input tax credits. The AGP does GCT is charged at the standard rate of 17.5% both public sector deficit, the Government of Jamaica not apply to the importation of the following goods: on the supply in Jamaica by a registered taxpayer announced several revenue enhancing measures I petroleum products specified in the second of goods and services and the importation into in December 2009. These measures were Schedule to the GCT Act; Jamaica of goods and services, by reference to the promulgated in the Jamaica Gazette supplement I capital goods within the meaning of the value of those goods and services. Special rates of December 2009 and took effect at various times Customs Act; are levied in the tourism and telecommunication during 2010. I goods imported under the GCT deferment sectors. scheme, for example as raw materials for the Increase in the GCT Rate purpose of manufacturing; GCT at the rate of 25% is levied on the provision I goods that are zero rated or exempt from of telephone instruments and services and since The rate of General Consumption Tax (GCT) GCT; April 1, 2010 the applicable rate of GCT on goods applicable to the provision of goods and services I telephone instruments; and and services in the tourism sector is 10%. was increased from 16.5% to 17.5%. This new I goods imported for which an uplift fee is In all other cases, goods and services are either rate became effective on January 1, 2010. chargeable under the GCT Act. classified as zero-rated or exempted based on a list of schedules modified from time to time by the Introduction of an Advanced GCT payment facility Imposition of GCT on electricity Minister of Finance and the Public Service.

The Government also announced the introduction With effect from February 2010, GCT applies in the Input and restrictions of an Advanced GCT payment (AGP) at the port of following circumstances to the consumption of entry and payable by “commercial importers”. AGP electricity by both residents and commercial users: In computing the tax due, the registered taxpayer represents an additional 5% on the import value. Supplies of electricity to residential customers up may deduct as input tax, the GCT suffered on A “commercial importer” is defined as “ a registered to 200 KwH per month shall be zero rated for GCT purchases of goods and services made during the taxpayer who, in relation to a taxable supply, im - purposes course of his taxable activity. There are however ports into Jamaica any goods that the Commis - restrictions on the amount of input tax that can be sioner of Customs is satisfied is (sic) imported for Supplies of electricity to residential customers (in claimed e.g. GCT associated with materials used resale or use in carrying out a taxable activity”. excess of 200 KwH per month) and to commercial in the construction of or repairs to any premises of or industrial consumers shall be subject to GCT at the taxpayer cannot be claimed as input tax. the rate of 10%.

I Customs Duty I Enviromental Levy

pwc 12 L Contents Jamaica

GCT Registration In addition to the above penalties, a registered tax - Environmental levy payer will also suffer interest at 2 ½% per month, or Any person engaged in the provision of goods and part thereof, on any tax, penalty or surcharge payable An environmental levy of 0.5 percent has been in services in Jamaica is required by law to apply and from the date on which such tax, penalty or surcharge force in Jamaica since June 2007. This levy is become a registered taxpayer if: becomes due, until the date the tax is paid in full. calculated on the CIF (cost of goods, insurance and I the gross value of the applicants supplies freight) value of imported goods, with some excep - exceeds J$3 million, taking into account total Special Consumption Tax tions. Goods imported by Jamaican residents up supplies in the month of application and that of to a value of US$500 per annum as well as those the preceding eleven months or Special consumption tax (SCT) has replaced several imported by diplomats and international organiza - I where commercial activities subsisted for less duties and taxes e.g. excise duty and consumption tions are exempt from this levy. than a year, the average monthly supplies of duty. SCT is payable by every registered taxpayer the applicant is in excess of JA$250,000 or who manufactures prescribed goods and any person Other Imports I The applicant is a manufacturer of prescribed who imports prescribed goods into Jamaica. Goods goods. subject to SCT include petroleum products, ciga - In addition to normal duties, all imports of goods rettes, alcoholic beverages and motor vehicles. generally attract a customer user fee at the rate Every registered taxpayer is required to file a GCT of 2% of the CIF value. However, importations of Return on a monthly basis. Payment of GCT is due Custom duties finished petroleum products, excluding those under within thirty days of the end of the period to which the PetroCaribe Agreement, attract a customer user the Return relates. Failure to file a GCT return at - Imported goods attract customs duties at various fee at the rate of 5%. tracts a Return penalty of up to 15% of the tax out - rates which can be found in the Jamaica Customs standing on the prescribed date. Failure to pay the Tariff publication. Under the Customs Act, valuation The importation of certain goods may also be correct amount of GCT by the due date attracts a is primarily based on the transaction value (CIF). This subject to , additional stamp duty, bureau payment penalty of 15% of the outstanding tax. Re - system of valuation is consistent with the WTO Agree - of standard fee and special consumption tax. peated failures in a twelve month period will ment on Customs Valuation and all imports are sub - result in a surcharge being levied. ject to the Caricom Common External Tariff (CET).

Contacts: Address: Eric Crawford Viveen Morrison Tel: 1 (876) 922 6230 Scotiabank Centre Senior Tax Partner Director Tax Compliance Services Fax: 1 (876) 967 1749 Duke Street [email protected] [email protected] P.O. Box 372 Kingston, Jamaica Brian Denning Paul Cobourne Website: http://www.pwc.com/jm/en Tax Partner Senior Tax Manager, [email protected] [email protected]

pwc 13 L Contents St. Kitts

Updates and developments The proposed VAT registration will require persons Customs Duties who have made or are likely to make taxable Value Added Tax (VAT) supplies in excess of EC$96,000 for certain All imports are subject to import duties (rates professional services and EC$150,000 for other from 0% - 70%), consumption tax (rates from 5% In April 2010, the Government released a white business activities in a continuous period of 12 - 15%) and customs service tax (6% of the CIF). In paper on Value Added Tax which it proposes to calendar months to register. VAT registrants will be all instances certain exemptions apply. introduce in November 2010. Draft legislation was required to file a VAT return with the Comptroller of also released in July 2010. Inland Revenue within 15 days of the end of each Customs Duty is levied on goods based on the cost, taxable period whether or not taxable supplies are insurance and freight ("CIF") values and rates The proposed VAT will replace the Consumption made during the taxable period. determined by the Caricom Common External Tariff. Tax, Hotel and Restaurant Tax, Cable TV Tax, Vehicle Rental Levy, Insurance Premium Tax, Proposed rates An environmental levy is applied on the importa - Export Duty, Public Entertainment Tax, Lotteries tion of vehicles only. The charge is calculated Tax, Gaming Machine Tax and Traders Tax. A zero rate is applicable to scheduled goods and based on dollar value rates from $1,000 - $5,000. services including fuel, exports, basic food items and The current excise tax will not be repealed, but will sale of real property on which stamp duty is paid. be reformed to support the implementation of VAT and should apply to only a small range of goods, A concessionary 10% rate is applicable on acco - such as alcoholic beverages, tobacco products, modation for the tourist industry. petroleum products, motor vehicles and aerated beverages. A standard rate of 17% is applicable to a wide range of goods and services imported or supplied in St. Kitts by registered persons.

Contacts: Address: Charles Walwyn Jefferson Hunte Neil M. Coates Cnr Bank Street & Managing Partner Partner Director West Independence Square, [email protected] [email protected] [email protected] Basseterre, St. Kitts Tel: (268) 462-3000 Tel: (869) 466 8200 Tel: (268) 462-3000 Tel: (869) 466-8200, Fax: (869) 466-9822 Website:http://www.pwc.com/kn/en/index.jhtml

I VAT – Value Added Tax I Customs Duty

pwc 14 L Contents St. Lucia

Updates and developments The Prime Minister indicated that “VAT remains a priority” but gave no indication as to when the tax Value Added Tax (VAT) would be implemented. In spite of the apparent readiness of the VAT Implementation Unit, it The Prime Minister in his delivery of the budget appears that VAT may have become a victim of address for the financial year 2010/2011 in political timing, and may not be implemented until Parliament on April 19, 2010, delayed the 2011 or after the next general election. implementation of the much anticipated VAT in St. Lucia. There are a number of major issues that remain to be resolved, the most significant of which is the The implementation of VAT has been promised in manner in which VAT would be applied to the hotel the last three budgets, and the VAT Implementation accommodation sector; but VAT appears to have Unit has been educating traders and taxpayers been successfully implemented in a number of for the advent of VAT. Draft legislation has been neighboring countries without significant discom - prepared and discussions have been held with all fort to these economies. sectors of the business community.

Contacts: Address: Richard Peterkin Claudette Rawlins Tel: (758) 452 2511 PricewaterhouseCoopers Centre Assurance, Tax & Corporate Tax Manager Facsimile : (758) 452 1061 Point Seraphire, P.O. Box 195, Services Partner [email protected] Castries, St. Lucia [email protected] Website: http://www.pwc.com/lc

I VAT – Value Added Tax

pwc 15 L Contents Trinidad & Tobago

Updates and devolepments The standard tax period is bi-monthly that is every rate of tax. The customs value applied on imported two (2) months. Persons registered for VAT are goods is the price paid for goods when sold for Currently, VAT is administered by the Board of required to submit a return and remit VAT due for export to Trinidad and Tobago. This is computed Inland Revenue (BIR). However, the BIR is to be each two-month period. Each return and VAT pay - on the CIF (Cost, Insurance & Freight) value and replaced by the Trinidad and Tobago Revenue ment is due on or before the 25th day of the month includes all other foreign costs incidental to the Authority (TTRA) in 2010. following the end of the VAT period. delivery of goods to Trinidad and Tobago.

An overview Failure to file a VAT return within the prescribed Relief from customs duty is available in certain time frame will attract a penalty of TT$500 for each instances for example, equipment that is imported Persons who are making or are likely to make outstanding return. Where VAT is not remitted within for a temporary purpose, or under a special license commercial supplies in excess of TT$200,000 the statutory timeframe, the amount outstanding will granted to a manufacturer. Generally, companies during any twelve-month period are required to be attract a penalty of 8% plus interest of 2%. operating in a Free Zone also enjoy relief from registered for VAT. customs duty. Customs Duty VAT is charged at the rate of 15% on goods The President (by order) can exempt the payment imported into, and the commercial supplies of Customs Duty is administered by the Customs and of duties, or revoke, reduce, increase or alter any goods and services in, Trinidad and Tobago. Excise Division. such duties.

However, certain goods and services such as basic Customs duties are levied on a wide range of Restrictions on importations only apply to left-hand food items and medical supplies are subject to tax imported goods at rates specified by the Customs drive cars, firearms, cigarette paper, small ships at 0%, while certain supplies, such as financial Act. The rates of customs duty are determined and boats, and a few agricultural products, services and rental of residential property, are either ad valorem or at fixed quantitative rates including live Christmas trees. exempt from VAT. and the rate generally ranges from 0% to 45%. However, certain luxury items are taxed at a higher

Contact: Address: Allyson West Tel: (868) 623 1361 11-13 Victoria Avenue Director Tax Services Fax: (868) 623 6025 Port of Spain, Trinidad [email protected] Website: http://www.pwc.com/tt/en

I VAT – Value Added Tax I Customs Duty

pwc 16 L Contents Contacts

Antigua & Barbuda I St. Kitts Dominica I Grenada I St. Lucia Curaco I Bonaire I St. Maarten

Charles Walwyn Richard N. Peterkin Steve R. Vananburg Managing Partner Assurance, Tax & Corporate Services Partner Tax Partner [email protected] [email protected] [email protected] Tel: (268) 462-3000 Tel: (758) 456 2626 Tel: 599 9 430 0000

Jefferson Hunte Claudette Rawlins Arne Kattouw Partner Manager Tax Services Head of Tax Technical Office [email protected] [email protected] [email protected] Tel: (869) 466 8200 Tel: (758) 456 2626 Tel: 599 9 430 0000

Neil M Coates Barbados Jamaica Director [email protected] Russ Jones Eric Crawford Tel: (268) 462 3000 Lead Tax Partner Senior Tax Partner [email protected] [email protected] Aruba Tel: (246) 626 6754 Tel: (876) 932 8323

Hans Ruiter Gloria Eduardo Brian Denning Partner Tax Partner Tax Partner [email protected] [email protected] [email protected] Tel: (297) 522 1647 Tel: (246) 626-6753 Tel: (876) 932 8423

Jourainne Wever Louisa Lewis-Ward Trinidad & Tobago Assistant Tax Manager Tax Director [email protected] [email protected] Allyson West Tel: (297) 522 1647 Tel: (246) 626-6756 Partner Tax Services [email protected] Tel: (868) 623 1361 x 173

About PricewaterhouseCoopers

PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for our clients and their stakeholders. More than 163,000 people in 151 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.

PricewaterhouseCoopers Caribbean Region refers to the regional grouping of PricewaterhouseCoopers firms in the Caribbean, each of which belongs to the network of member firms of PricewaterhouseCoopers In - ternational Limited (“PWCIL”). Each member firm is a separate legal entity and does not act as an agent for PWCIL or any other member firm.

This booklet has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (expressed or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers East Caribbean, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

© 2010 PricewaterhouseCoopers East Caribbean All rights reserved. "PricewaterhouseCoopers" refers to PricewaterhouseCoopers East Caribbean or as the context requires, the PricewaterhouseCoopers global network or the member firms of PricewaterhouseCoopers Caribbean Region, or other member Firms of the network, each of which is a separate legal entity.

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