In 2018, the foreign currency permit regime was introduced in Barbados, providing a range of benefits for certain entities which earn one hundred per cent (100%) of their income in foreign currency. This regime encouraged foreign investment and improved the ease of doing business, ensuring Barbados’ competitiveness in the international business arena while being compliant with international tax and transparency standards.

Holders of a valid foreign currency permit (“FCP”) are exempt from the provisions of the Exchange Control Act, Cap. 71, qualify for reduced stamp duty rates under the Stamp Duty Act, Cap. 91, and are also granted an exemption from certain property transfer taxes under the Property Transfer Tax Act, Cap. 84A.

The Foreign Currency Permits Act, 2025-5 (“FCP Act 2025”) builds on those benefits and introduces more favourable provisions for qualified persons that earn one hundred per cent (100%) of their income in foreign currency. Notably, the definition of qualified persons has now been expanded to include external companies and trustees in relation to a trust, in addition to companies, firms or societies.

The FCP Act 2025 also addresses a gap left by the 2018 repeal of the International Trusts Act Cap. 245 which effectively removed the exemption for trusts from the provisions of the Exchange Control Act. Under the FCP Act 2025, a trust holding an FCP is explicitly exempt from the Exchange Control Act, providing greater certainty and enabling trustees to conduct trust transactions in foreign currency more cost effectively and efficiently.

Another significant enhancement under the FCP Act 2025 is the introduction of import duty relief for FCP holders exclusively engaged in the trade of services. Such entities can now import, free of customs duty, value-added tax and ad valorem stamp duty a range of items necessary for conducting business including plant, machinery, equipment, fixtures, appliances, apparatus, tools, spare parts, raw materials, goods, and components ("machinery and equipment"). This added benefit is subject to the restriction that the FCP holder may not sell any of this machinery and equipment, except in the ordinary course of business, for a period of five years from the date of importation, unless:

1. the sale is made to another FCP holder, or
2. the applicable duty, tax or other impost that would have been payable is first paid to the Comptroller of Customs.

The FCP Act 2025 demonstrates Barbados’ ongoing commitment to improving the ease of doing business through ensuring clarity and certainty for international investors and local entities dealing in foreign currency. By expanding the scope of qualified entities, reinstating important exemptions for trusts and introducing new fiscal incentives, the FCP Act 2025 not only addresses previous gaps but sets a progressive framework for future growth.

For reference:

Foreign Currency Permits Act, 2018-44
Foreign Currency Permits Act, 2025-5

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