Aug 2009 Financial News

Jamaica to reduce stamp duty

Aug 03, 2009

The Jamaican government has decided to implement a reduction in stamp duty and transfer tax, five months ahead of schedule in an effort to stimulate the flagging real estate market.

Minister of Finance and the Public Service Audley Shaw said the move to put the measures in place from Saturday, August 1 was in response to the drastic reduction in real estate transactions reported by the Tax Administration Department, which has resulted in further revenue loss and a lag in the sector. In his budget presentation in April, Shaw announced that stamp duty would be reduced from 4.5 per cent to three per cent and that transfer tax reduce from five per cent to four per cent, effective January 1 next year.

He said that the move would cost the government J$644 million (US$7.32 million) in revenue, but was expected to stimulate a recovery in property sales and construction investments. Since the announcement the real estate sector has been lobbying government to bring the implementation forward to trigger an earlier recovery. Shaw told parliament this week that with the new proposed implementation date, stamp duty and transfer tax would have been reduced by almost half, since September 2007.

“These proposed rates will bring Jamaica’s stamp duty and transfer tax rates more in line with international standards,” he said. “We see examples in Argentina, their stamp duties range from 0.5 per cent to 2.5 per cent and transfer tax is 1.5 per cent. Barbados has a stamp duty of one per cent, no transfer tax, Belize has a stamp duty of five per cent and no transfer tax.”

Shaw said the initiative is supported by the government’s efforts, through the Office of the Prime Minister, to accelerate the application and approval process in the housing and construction industry. He urged the Parish Councils to aid in ensuring the expedition of the approval process, in order to revitalise activity in the construction sector. Shaw urged real estate buyers and vendors to take advantage of these significantly reduced real estate transaction costs, in order to stimulate the sector and create jobs. (Caribbean360.com)

Source: Trinidad Guardian
http://guardian.co.tt/business/business/2009/08/03/jamaica-reduce-stamp-duty
Date published: Aug-03-2009