Saint Kitts: Country and Foreign Investment
Investment Incentive Schemes
Under the Fiscal Incentives Act, four types of enterprise qualify for tax holidays. The length of the tax holiday for the first three depends on the amount of value added in Saint Kitts & Nevis. The fourth type, known as enclave industry, must produce goods exclusively for export outside the CARICOM region.
Group I enterprises, which add 50% or more in value in Saint Kitts and Nevis are entitled to tax holidays of up to 15 years.
Group II enterprises add 25% to 50% in value in Saint Kitts and are netitled to a maximum tax holiday of 12 years.
Group III enterprises, which add 15% to 25% in value in the jurisdiction are entitled to a maximum tax holiday of 10 years.
Finally, Enclave business are entitled to a maximum tax holiday of 15 years.
Saint Kitts provides companies with a further tax concession effective at the end of the tax holiday period, which, in effect, is a rebate of a portion of the income tax paid based on export profits as a percentage of total profits.
The Hotel Aids Ordinance provides duty-free concessions (relief from customs duties and pier dues) on items for use in the construction, extension and equipping of a hotel of not less than 30 bedrooms. The Income Tax Ordinance provides special tax relief benefits for hotel proprietors granted licenses under the Hotel Aids Ordinance: the gains or profits of a hotel of more than 30 bedrooms are exempt from income tax for a period of 10 years, for hotels with less than 30 bedrooms, the gains and profits are exempt from income tax for a period of 5 years.
Companies which qualify for tax holidays are allowed to import into Saint Kitts and Nevis duty-free all equipment, machinery, spare parts and raw materials used in production.
Under the Caribbean Basin Initiative, besides participating in the financial contribution allocated by Washington to the member countries, Saint Kitts also qualifies for duty-free entry into the United States of more than 95% of its products, not including sugar. Under the Generalized System of Preferences (GSP), manufactured and semi-manufactured goods are also eligible for duty-free access to United States markets. Virtually all of Saint Kitts-produced items and raw materials are eligible for GSP treatment under the list of some 2,800 products eligible for duty-free importation. However, to qualify, the product must have had 35% of its appraised value added in the beneficiary country. Again, this enhances Saint Kitts' status as a site for conversion of merchandise because of its skillful and well-trained labor force.
The Saint Kitts Investment Promotion Agency (SKIPA) officially launched its long anticipated website on February 2, 2009. SKIPA, created in December 2007, proactively promotes Saint Kitts as an international finance centre and arranges local and foreign investment projects.
“This new website will be an important tool in promoting Saint Kitts as a preferred investment destination by offering a wealth of information to potential investors worldwide,” said a SKIPA statement.
“The website features investment related news, information about SKIPA and Saint Kitts and an Investor’s Guide that draws information from the various institutions that play a role in the establishment of sound businesses. The website also highlights the Priority Sectors that are crucial for the continued development of the nation, as well as investment opportunities that exist on the island,” said SKIPS’s Market Research Officer, Darien Belle.
He explained that visitors to the website will be provided with a unique opportunity to interact with the agency and other visitors through an interactive discussion forum.
“We are particularly excited about this medium of communication which is intended to foster discussions geared towards improving the business conditions in Saint Kitts for existing firms and potential investors,” he said.
Shawna Lake, CEO, SKIPA, underlined the agency's role in Saint Kitts.
“SKIPA is not only charged with the responsibility of promoting investment opportunities available in Saint Kitts but one of our most important functions is to facilitate inward investment by working with persons who have made the decision to establish a business in Saint Kitts. We assist these investors by providing them with general information on application requirements and procedures and we also facilitate the submission of their applications to the various government departments for review and approval.”
“Another important service offered by SKIPA is aftercare. This service has evolved from our belief that businesses in Saint Kitts should have access to a capable support system. As part of our aftercare services, we follow up with investors who have already established their businesses in Saint Kitts in an effort to understand the issues facing their business or industry and to assist them in developing viable solutions. SKIPA also provides support to businesses that are interested in expansion," concluded the statement.