NASSAU, BAHAMAS — The 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 improving its efficiency.
The draft National Trade Policy Document noted that the government maintains various support programs for Bahamian businesses. These schemes include, but are not limited to, the Industries Encouragement Act, the Agricultural Manufactures Act, the Spirits and Beer Manufacture Act, and the Hotels Encouragement Act. In addition, Chapter 98 of the Customs Act also provides customs duty exemptions for other product groups and beneficiaries.
“While in principle these existing incentive programs have helped (some companies said they were essential) domestic businesses and compete with competition from imports and in export markets, they also pose a number of challenges. “, reads the draft policy.
“First of all, not all companies are eligible (or register) for exemptions, and it is not always clear who is eligible or not. In addition, lists of inputs or equipment exempt from import duties are not always entirely appropriate or up to date.
It was also noted that the various incentive laws set different conditions for qualifying for the exemptions and provide for different scope of application for the exemptions.
“Furthermore, the administrative and compliance costs of inducing acts are higher – further exacerbated by the spread of exemptions and benefits across various laws and regulations, involving a range of government departments – compared to a situation where legal rates were lower.”
The document notes that in view of the problems identified arising 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 to improve its efficiency.
To this end, a comparative review of all incentive schemes in place for domestic companies will be undertaken alongside the review of import tariffs and the review of customs fees.