NASSAU, BAHAMAS — Government will undertake a review of the various incentive acts and duty exemption schemes and their use, with the aim of streamlining the system and enhancing efficiency.
The draft National Trade Policy document has noted that the Government maintains various support schemes for businesses in The Bahamas. These schemes include but are not limited to the Industries Encouragement Act, the Agricultural Manufacturies Act, the Spirits and Beer Manufacture Act, and the Hotels Encouragement Act. Additionally, Chapter 98 of the Tariff Act also provides for exemptions from customs duties for additional groups of products and beneficiaries.
“Although in principle these existing incentive schemes have helped (some businesses stated that they have been essential) domestic businesses and compete with import competition and on export markets, they also pose a number of challenges,” read the draft policy.
“First, not all businesses are eligible (or register) for the exemptions, and not always it is clearly specified who is eligible or not. Also, the lists of inputs or equipment exempted from import duties are not always fully appropriate or up-to-date.”
It was also noted that the various encouragement acts set different conditions to benefit from exemptions as well as provide a different scope for exemptions.
“Additionally, the administrative and compliance costs of incentive acts are higher – further exacerbated by the spread of exemptions and benefits across various laws and regulations, involving a range of ministries in the administration – compared to a situation where statutory tariffs were lower.”
The document noted that considering the identified issues stemming from the existence of the various incentive acts and duty exemption schemes, “the Government will undertake a review of the current schemes and their use, with the aim of streamlining the system and enhancing efficiency”.
To that end, a comparative review of all incentive schemes that are in place for domestic businesses will be undertaken together with the import tariff review and the review of customs fees.
