Barbados, a gem in the Caribbean, is opening its doors to sustainable development and economic growth through the Special Development Areas Act. This legislation provides various concessions to approved developers for specific activities in designated geographical areas within Barbados, aiming to foster development and attract investments.
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Designated Development Areas
The Act identifies several key areas across the island that are primed for development:
- Carlisle Bay Redevelopment Area in St. Michael
- Speightstown in St. Peter
- St. Lawrence Gap in Christ Church
- The Scotland District Conservation Area
Eligible Activities for Development
Approved developers can engage in a wide range of activities within these areas, contributing to the island’s growth and sustainability:
- Hotels including conference facilities
- Residential complexes
- Commercial or industrial buildings, including office complexes
- Other tourism facilities
- Water-based activities
- Tourism projects that highlight heritage and the natural environment
- Arts and cultural investments
- Agricultural-based activities
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Tax Concessions for Developers
To incentivize development, the Act offers various tax concessions to approved developers and certain investors (excluding commercial banks):
- Exemption from income tax on interest earned on loans made to approved developers for development work during the development period.
- Income tax reduction to a rate of 30%.
- Initial and annual allowances on industrial buildings at 40% and 6%, respectively.
- Initial and annual allowances on commercial buildings at 20% and 4%, respectively.
- Exemption from import duties and VAT on inputs for constructing new buildings or refurbishing existing ones.
- Exemption from charges on the repatriation of interest or capital for ten years.
- Exemption from land tax on the improved value of the land.
- Exemption from property transfer tax payable by vendors on the initial purchase of the property, applicable to both nationals and non-nationals.
The Special Development Areas Act is a significant step towards boosting investment, enhancing infrastructure, and promoting sustainable development in Barbados. By providing these incentives, the government aims to attract diverse projects that will contribute to the island’s economic growth and preserve its natural and cultural heritage.
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