The Barbados International Business Association (BIBA) endorses the public recognition given to the international business sector as a vital source of foreign exchange for Barbados in the 2012 national Budget submission
New BIBA President Ms. Melanie Jones said Minister of Finance, Christopher Sinckler delivered “a measured recognition of the inescapable fact that Barbados’ heavy dependence on foreign exchange to pay its high import bills for fuel and other consumables, demands that a serious and tangible effort be made to support and capitalize on the international business sector’s potential to be the leading generator of foreign exchange for Barbados”.
Ms. Jones said BIBA welcomed the lowering of the minimum tax rate for international business entities. She described it as a meaningful response to the island’s recent loss of its competitive advantage in the Canadian market due to the fact that changes in that country’s foreign policy meant Barbados was no longer unique as a country from which Canadian subsidiaries engaged in active business could repatriate their dividends tax free back into Canada. Moreover, she said the now highly marketable lower tax regime would also enable Barbados to stimulate new business from other important markets such as Latin America and the United Kingdom.
The partner at Lex Caribbean acknowledged that Minister Sinckler’s projection of a tax revenue loss in the first year of implementation was realistic; but she added that BIBA was quietly confident that this enhanced tax regime would ultimately lead to an increase in the volume of business brought to Barbados, which would, over time, amply compensate for the initial loss.
Similarly, the provision for a special entry permit system that would allow high net worth individuals and their families to secure long-term status in Barbados, was also welcomed by BIBA, Ms. Jones said. She noted that beyond the wealthy individuals in the United Kingdom identified by Minister Sinckler as our target for this product, recent outreach by BIBA and Invest Barbados in Canada demonstrated a keen interest there for immigration policy developments of this kind in Barbados.
However, Ms. Jones cautioned that the potential for these new measures to attract foreign investment would be squandered unless they were intensively promoted as part of a sustained effort to showcase Barbados as a hub for international business. Ms. Jones noted that, while it was appreciated that there were multiple demands on public funds, a meaningfully increased allocation to the agencies charged with foreign investment promotion, in addition to the multi-million dollar reinvestment in tourism promotion announced by the Minister of Finance, would have been warmly welcomed. This was especially so given the almost $880 million cited by the Minister, as the contribution made annually by international entities to the Barbados economy through corporation tax revenues and additional spend.
Ms. Jones added it was also vitally important that the public and private sector partner in the evolution of our current business facilitation environment into one which is globally competitive by any objective standard. In that connection, Ms. Jones said measures aimed specifically at improving the services critical to ensuring the retention and expansion of existing and new business would have been valuable additions to the budget, notwithstanding the Minister’s welcomed announcements with respect to factoring and Fund Access.
In concluding, Ms. Jones said that BIBA looked forward to the House of Assembly’s “international business legislation day” slated by the Minister to follow the post-Budget break. She affirmed that BIBA remained enthusiastically committed to collaborating with other stakeholders, including government, on enhancing Barbados’ legislative framework as a key component of its international business advantage.