Tag Archives: Barbados Taxes

Increased taxes and costs are killing tourism. Barbados government actions “simply defies rationale”

Barbados Solid Waste Tax

Adrian Loveridge - tourism expert, hotel owner

Adrian Loveridge – tourism expert, hotel owner

I had hoped to dedicate this week’s column to the new measures put in place announced in the 2015 budget to stimulate spending, especially in the tourism sector.

Unless I missed something while trawling through the 57 pages, not a single ‘incentive’ has been announced that would be likely to encourage increased domestic spending across the sector.

Conversely, many could fairly claim that the additional $200 million in taxation annually will further restrain people’s ability to take a ‘staycation’ or enjoy one of many excellent restaurants.

Government Broke: VAT refunds two years past due.

In fact private sector led initiatives like the re-DISCOVER dining promotion have been forced to scale down any paid promotion, due to the continued inability to reclaim due and payable VAT refunds, now overdue for more than two years. This in itself is ludicrous and short sighted as many of the participating restaurants do not qualify and are unable to apply the reduced rate of 7.5 per cent VAT, but obligated to pay the higher 17.5 per cent rate.

So Government could be easily losing up to $2 million a year in lost taxes. Add the duties and taxes lost in the included wine element and that figure could well be significantly more, let alone the employment this promotion generates.

Until we witness some real actual sustained recovery in tourism, it is very difficult to comprehend why any Government thinks that increasing taxation and operating costs will reduce the time it takes to attain that objective.  Continue reading

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Filed under Barbados, Barbados Tourism, Economy

Municipal Solid Waste Tax is another attack on a beleaguered Barbados tourism and hotel sector

peach-and-quiet-barbados-cricket.jpg

“What is especially galling is that we are expected to pay this new solid waste tax imposition before we receive the tens of thousands of Dollars we are still owed in NIS and VAT refunds…”

Adrian Loveridge - tourism expert, hotel owner

Adrian Loveridge – tourism expert, hotel owner

When my now wife and I ‘discovered’ a then virtually derelict Arawak Inn back in 1988, we never really set out to become seasoned hoteliers. More like having the privilege of living in a big ‘house’ right on the ocean and sharing it with a few friends and the many clients who followed us over the years with our British based tour operators business. Every restored and occupied room was another gallon of paint or new soft furnishing.

Our first major setback came when after paying the initial deposit to buy the hotel, the value of Sterling plummeted from over BDS$4 to the Pound to BDS$2.88 at the time of completion. As all our funds were brought in from overseas, there was no alternative as an option.

Effectively this wrote-off literally every cent we had budgeted for renovation and improvement of the property. As new residents it was virtually impossible to borrow monies from the banks. They wanted a trading record, three years of audited accounts, cash flow forecasts and business plans among many other requirements. Suppliers, with very few notable exceptions, would not grant us credit and so we learnt very quickly, how to not only survive, but flourish and transform the hotel from earned trading revenue.

While easy to say now, in hindsight, it was probably the best thing that happened, leaving us totally debt-free years later.  Continue reading

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Filed under Barbados, Barbados Tourism

Origins of the Barbados Solid Waste Tax

Barbados Solid Waste Tax (click photo for large)

Hey Boss! I just got a great idea for a new tax!

Our thanks to Bajan Poppets!

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Filed under Barbados, Politics

Lost your job recently? Tough luck… your first Solid Waste Tax payment is due at the end of June

Margaret Sivers Barbados Vampire

New tax heaps insult upon injury

About to be unleashed on tens of thousands of Barbados Property owners is a new Tax that over time will cost thousands of dollars per household. Slipped into Parliament, approved and now to be implemented by month end, the first Solid Waste Tax installment is due by the end of June.

Please correct me, but were we not already paying taxes that the government said supported waste collection?

Where are people going to get the money to pay this new onerous tax?

Madness… this is what people in other countries take to the streets for! Help!

BLP Senator Wilfred Abrahams sees the harm coming…

“There are people in Barbados who do not have $215 to pay to keep on the electricity, to keep on the water… I do not believe that legislation aimed at raising revenue should catch people like pensioners. There is a reason they were excluded from Land Tax, there is a reason that concessions are usually being given in respect of pensioners. Why are we dragging them into this catch all?”

Senator Wilfred Abrahams talks to the Barbados Advocate

Meanwhile, Government Senator Maxine McClean says another tax is no problem so shut up.

First Solid Waste Tax Installment Due Month End
Dated June 11, 2014

Property owners are advised that the first installment of the new Municipal Solid Waste Tax should be paid by month-end.

Revenue Commissioner of the Barbados Revenue Authority, Margaret Sivers, said property owners would be allowed to pay the new tax in two equal installments. Continue reading

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Filed under Barbados, Barbados Government, Economy

Small business waiting two years for VAT refunds from Barbados government

Is Government really serious about Small Businesses?

by Adrian Loveridge, small hotel owner

After nearly 25 years running a small business on Barbados, I really wonder if the current Government, or in fact previous ones, are serious about encouraging small businesses and nurturing entrepreneurship.

Yet once again, we have been waiting for up to two years for various VAT refunds. If we are one day late submitting a return, a late filing fine and interest are payable, but clearly this is just a one way penalty.

Currently the following refunds are pending. 2010/07 period – $5,347.95, 2010/09 period – $7,675.73, 2011/07 period – $7,124.28 and 2011/09 period – $4,569.53.

So a total of $24,717.49 outstanding. Consider the strain on the business if we are paying overdraft interest on that amount.

Despite Government imposing a massive 16.6 per cent increase in the rate of VAT, it would appear that this hasn’t had any improvement of the level of efficiency. The private sector has been forced to absorb huge increases in most of our operational costs, while trying to maintain employment. Yet to the best of my knowledge, not a single civil servant has lost their job or witnessed a salary reduction.

In fact, to the contrary, it seems almost totally morally incomprehensible to see that certain public workers have taken delivery of  gas guzzling, luxury vehicles during a period of severe austerity.

The current Minister responsible for small businesses is very vocal and heard almost daily on the call-in programmes with a whole range of opinions. But now is the time to get off the phone, stop talking the talk and do more of walking the walk.

The late repayment of VAT refunds is not new and has been going on for years. Trade Associations representing various sectors have made repeated appeals but seemingly on deaf years.

If the current Government really wants the economy to recover and soak up high unemployment, it is going to be led by small businesses. Now is the time to give your support and ensure our massive civil service does the job they are well paid for.

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Filed under Barbados, Barbados Tourism, Business & Banking

Are these Barbados plantations still receiving an agriculture rebate on their Land Tax?

Sugar cane was once like gold or oil

To our knowledge, each of the following plantations are not in any meaningful agricultural production, or have been given over to housing or commercial activities. Are they still receiving an agricultural rebate on their land taxes?

Exchange Plantation, St Thomas
Alleynedale Plantation, St Peter Continue reading

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Filed under Agriculture, Barbados, Sugar

Barbados Needs Lower Intra-Caribbean Air Taxes To Help Level The Playing Field Between Cruise Ships, Air Travel And Island Hotels

barbados-cruiseship-boarding.jpgAt a time when various Caribbean Ministers of Government have recently met and agreed to levy yet another tax on intra Caribbean air travel, its time perhaps for them to contemplate exactly the effect its having on land based tourism.

A seven day cruise departing from Barbados was recently advertised with one of the largest companies, taking in St. Lucia, Antigua, St. Kitts, Puerto Rico, St. Thomas, Dominica and back to Barbados.   With a lead-in price from US$449 per person plus mandatory gratuities, Government fees and taxes, it represented what many might consider outstanding value-for-money. Especially as when you consider most meals, and other features like entertainment are included.

Of the overall total cost, an amount of US$55.42 per person is shown as Government fees and taxes.   Now let’s say you were the same person considering visiting our Caribbean neighbours and taking the cheapest published airfares between point to point, what would you pay in Government taxes and add-ons?

Barbados-St. Lucia US$61.87; St. Lucia – Antigua US$82.57; Antigua-St. Kitts US$42.10; St. Kitts – San Juan US$52.70; San Juan – St. Thomas US$34.50; St. Thomas – Dominica US$33.00 and Dominica- Barbados US$25.38!

Barbados Grantley Adams International Airport

Barbados Grantley Adams International Airport

So a massive US$332.12 per person in taxes and add-ons to visit the same number of destinations by air! In fact this figure is even higher, because some governments are not yet including the departure tax in the ticket price.

Now what about the overall contribution to the region?   Well we know many of the ships are not registered in the region. We know they largely employ extra-regional crew and officers, who as far as I am aware contribute little in national insurance contributions, income or other taxes to the Caribbean.   The overwhelming percentage of what is consumed onboard is sourced outside of the Caribbean.

And finally, where does the lion’s slice of the revenue and profit generated from the world’s largest cruise market go?   Of course, outside the region!   On the other hand, the almost dominant regional airline has been subsidised over decades by the Caribbean taxpayer. The reason we are told the departure taxes are so high is because we need to upgrade the airports, but wait a minute, don’t we, and haven’t ‘we’ upgraded the ports as well?

How can anyone reasonably argue for airports to extract more than six times the amount in taxes than our ports do?

For the ship cruise operators, when the going gets tough, all they have to do is haul the anchor and sail off to Alaska, Dubai or the Mediterranean.   Hoteliers and other land-based tourism partners sadly do not have that option.

I am not, repeat not advocating against the cruise ships and their recognised contribution. But simply asking the playing field to be levelled to a degree where we can at least think of competing and surviving in these troubling economic times.   Yes! There have been repeated calls for hoteliers to lower their rates and make them more affordable to Caribbean Nationals, while at the same time considerable pressure has been placed on them to maintain employment.   Most of recognise the desirability of having a truly pan Caribbean marketing campaign, but don’t do it at the expense of an already barely viable accommodation sector.

Adrian Loveridge

30 May 2009

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Filed under Barbados, Barbados Tourism, Business, Tourism, Travel, Traveling and Tourism