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Dominica's Parliament Approves VAT Changes

by Mike Godfrey, Lowtax.net, Washington
03 October, 2014

The Parliament of Dominica approved legislation to amend the Value Added Tax Act 2005 at its session on September 22, 2014.

The amendment implements measures announced in the 2014/15 Budget presented on July 23, 2014. The measures include a VAT exemption on hotel service charges, effective from September 1, 2014, and also items imported by courier that are valued at less than XCD150, effective from August 1, 2014.

According to the Government, the amendment provides for the non-application of VAT on accommodation, meals, and beverages where the service charge is explicitly stated. The exemption is limited to service charges that are up to ten percent of the value of the service. Further, 75 percent of the service charge must be paid to employees.

The territory's Minister for Information, Ambrose George, who introduced the Bill in Parliament, said: "The payment of the VAT on service charge was identified by the hotel sector as an area of major concern, and the sector is of the view that it is one of the areas which makes the sector uncompetitive. It is hoped that this measure will address the issue of competitiveness."

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