Antigua and Barbuda (ABST) becomes effective Monday January 29, 2007

The Government and Ministry of Finance would like to remind businesses and consumers that the Antigua and Barbuda Sales Tax (ABST) will become effective on Monday January 29, 2007. Preparations for the ABST began in early 2005 with a feasibility study to review the benefits of introducing a value-added type tax. After this study the government prepared an ABST White Paper which was presented for discussion and review with all relevant stakeholders. A number of concerns raised by the stakeholders were taken on board and resulted in changes to ABST policies. In particular, the government agreed with the private sector that the ABST threshold should be changed from $1,000,000 to $300,000 to ensure equity to businesses and the list of zero-rated and exempt items have been expanded on several occasions since 2005. Businesses also raised concerns regarding the best timing for introducing the ABST and to meet the concerns raised, the government shifted the implementation date on several occasions to ensure bu sinesses had sufficient time to prepare for its implementation (e.g. April 2006 was the original implementation date, which was then shifted to third quarter 2006, then to January 1, 2007 and finally January 29, 2007 was selected as the implementation date).

ABST to support CSME and harmonization in the Caribbean

The introduction of a value added type tax is not unique to Antigua and Barbuda as a number of other Caribbean countries have introduced or are planning to introduce a tax similar to the ABST. Jamaica, Barbados and Trinidad & Tobago have had a value added tax for several years. Belize, Dominica, and Guyana have introduced a value added tax since early 2006. The value added tax will be implemented in St. Vincent and the Grenadines on May 1, 2007 and Grenada will be introducing the tax later in 2007. Other countries such as St. Kitts and Nevis, St. Lucia, and the Bahamas are in the early stages of considering the benefits of a value added type tax.

The government would like to highlight that the list of zero-rated goods in Antigua and Barbuda (goods that do not attract ABST) is the most extensive in the Caribbean.

Preparing businesses and consumers for the ABST

Since early 2006, the Inland Revenue Department has been taking steps to educate potential registrants regarding the mechanics of the ABST. A number of open sessions have been held since early 2006 and IRD officers met with a number of businesses on a one-to-one basis to ensure a good understanding of the ABST. In recent months, a publicity campaign has been launched to educate businesses via TV/radio talk shows and through use of the print media.

A publicity campaign has also been launched in recent weeks to educate consumers regarding the impact of the ABST.

The publicity campaign to educate businesses and consumers will continue until January 29, 2007 and will be extended beyond the implementation date to ensure all steps are taken to ensure the best possible understanding of the Antigua and Barbuda Sales Tax.

ABST an integral component of a more comprehensive reform program

The introduction of the ABST is part of the government's overall reform program. Businesses and consumers should be aware that with the introduction of the ABST a number of existing taxes will be repealed. This includes: (1) Consumption Tax, (2) Hotel (bed-night) Tax, (3) Hotel Guest Tax, (4) Hotel Guest Levy, (5) Restaurant and Catering Services Tax, and (6) Telecommunication Tax. The Ministry of Finance has also announced plans to proceed with a Customs Renewal Program in 2007 which will streamline and modernize customs operations.

How to obtain more information regarding the ABST?

For a copy of the ABST Act which was adopted on September 5, 2007 please refer to the link on this page entitled "Legislation and Regulations". A copy of the ABST regulations can be found on the link entitled "Inland Revenue".

The "Inland Revenue" link will also provide access to a significant amount of information regarding the ABST. This link will include copies of all ABST related forms and ABST guides which will help registrants, consumers, and traders understand the ABST. In addition, the link will provide access to a number of the publicity materials that have been prepared for the ABST (e.g. pamphlets, flyers, presentation materials).

If you need any additional information you can send an email to ABSTINFO@Gmail.com.