The Bahamas’ Ministry of Finance announced recently that it will be extending tax relief measures under the Special Economic Recovery Zone (SERZ) Extension Order for Grand Bahama and the Abacos islands.
Following the passage of Hurricane Dorian, the Government designated Grand Bahama and the Abacos islands as ‘Special Economic Recovery Zones, offering residents on the islands tax concessions as they recovered from the devastating impact of the storm.
On January 12, the ministry issued a notice advising that Cabinet has approved the Disaster Reconstruction Authority (Special Economic Recovery Zone) (Relief) (Amendment) Order, 2021, which includes construction services in the list of tax exempted activities, until June 30, 2021.
“Construction activities remain a critical item for the recovery process. The SERZ Extension Order approved in December provided tax relief on the local sale and importation of construction supplies. The latest amendment order allows for the zero-rating of construction services, which will render these activities VAT Free within the Zone until June 30, 2021,” Senator Kwasi Thompson, the minister of state for finance, explained.
However, a provision in the order specifically requires that services invoiced before June 30 should be paid in full by September 30, 2021.
This latest amendment also extends the time allowance for the import of VAT free vehicles. Replacement vehicles must be purchased and shipped prior to January 31, 2021, representing a one-month extension, and arrive in The Bahamas by April 30, 2021.
“The Government is listening and responding to the needs of the people. The road to recovery is not an easy one for residents in the islands devastated by Hurricane Dorian, and we are doing everything we can to provide support where we can,” Senator Thompson said.
In December, while providing a statement on the Extension of the Disaster Reconstruction Authority, Minister Thompson informed that though government revenues were down by as much as 50 per cent, the Hubert Minnis Administration would ensure that it still does as much as possible to cushion the economic blow for communities experiencing hardship.