The Bahamas’ planned increase in value-added tax takes effect on July 1, and the government has outlined the special transition period for tourism businesses.
Like other industries, tourism businesses will then be required to pay 12% VAT, up from the current 7.5%.
However a special agreement has been sealed by the government and tourism industry stakeholders which ensures a ‘smooth transition’ for all hotels and resorts, tour operators and ground operators, attractions and other key tourism businesses.
Any existing material bookings made on or after July 1 until September 30 for rooms, services, facilities and package deal arrangements for use through June 30, 2019, will still be liable only for 7.5% VAT.
The current 7.5% is valid also for any other material bookings made until July 31st 2018 for travel on any date including beyond June 30, 2019.
The Department of Inland Revenue must be sent details of all eligible bookings by August 31, 2018 to be considered for the current 7.5% rate.
VAT is payable on most goods and services, including food and beverages.
