Summary of the Budgetary Proposals Relating to Land Tax

The recent budgetary proposals tabled by the Minister of Finance the Hon. Chris Sinckler, included a number of amendments to the land tax rates for all categories of properties. The amendments included a reduction in the residential value bands and an increase in the non-residential and unimproved land rates. The stated objective of the amendments is to raise an additional $44M […]

By Terra Caribbean

July 17, 2015

Sapphire Beach, Dover, Church Christ, Barbados Sapphire Beach, Dover, Church Christ, Barbados - 54 elegant apartments located steps from the beach and minutes from St. Lawrence Gap.

The recent budgetary proposals tabled by the Minister of Finance the Hon. Chris Sinckler, included a number of amendments to the land tax rates for all categories of properties. The amendments included a reduction in the residential value bands and an increase in the non-residential and unimproved land rates.

The stated objective of the amendments is to raise an additional $44M in revenue. Also notable is the removal of the Municipal SolidWaste Tax (MSWT) that was implemented in the previous fiscal year. Whereas the effect of the amendments to the land tax schedule are net increases across the board, the removal of the MSWT will serve to offset these increases but only for some categories of properties. It should be noted that given the MSWT was not assessed on the unimproved land category there would be no offset from its repeal for the vacant land calculation. The reality is that property market values have declined by 20 – 40% in the recent 5-year period and as such there should be a corresponding reduction in the land tax to be paid, however in some instances this decline in values is not reflected in the land tax valuations. Note the revaluation period is every three years with the 2014 – 2015 period being the most recent valuation year.

It is notable that the Barbados Revenue Authority took a different approach last year breaking from the long tradition of sending out separate Valuation Assessment notices. Property owners were not made aware of any change in the value of their properties until the actual bill was received. In fact many tax payers were asked to pay the MSWT based upon a new valuation assessment of which they were not previously informed.

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Terra Caribbean

Terra Caribbean is a Caribbean real estate services practice based in Barbados with other offices in Trinidad and Grenada. We are a fully integrated firm offering services in brokerage (sales and rentals), advisory, and property management. Our team comprises some of the most qualified real estate professionals on the island and is made up of a diverse skill-set extending to both residential and commercial real estate. We work with the best developers in Barbados and service the needs of every client to ensure their ultimate satisfaction be it to sell, purchase, rent, value or manage their property. “ We know Barbados!"

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