Home > Regions > North America > Stamp Duty Amendment & the New Real Estate VAT Rule

Stamp Duty Amendment & the New Real Estate VAT Rule

In January, 2015 The Government of The Bahamas implemented Value Added Tax (“VAT”) at 7.5% to be charged on all goods and services. This new VAT tax affected many businesses, as businesses were required to update their computer systems in order to implement VAT in compliance with the new law. Food stores and other stores selling goods were not the only businesses that were affected, but also those businesses providing services. Law firms were affected and were forced to increase their fees. Six months later, it appears that this 7.5% was not sufficient for the Government as it relates to real estate transactions. When one is selling or buying property one must consider the additional costs of VAT associated with the transaction as VAT is charged on the appraisal report, legal fees, search fees and now on the consideration or appraised value of the property (which ever is accepted and approved by the Controller of VAT). More…