Located in the beautiful seas of the Caribbean, The Bahamas is formed from a group of 700 islands and 2,400 cays that spans over 100,000 square miles of nature’s beauty. Apart from its alluring charm of nature and beaches, The Bahamas is home to many foreign firms and financial institutions that have been drawn by the country’s tax haven status. Additionally, the country maintains a stable environment for investments and businesses to be conducted, supported with a long tradition of democratic parliaments and respect for the rule of law. Before you decide to register company in Bahamas, allow Tetra Consultants to share with you 4 advantages of starting a business in The Bahamas.
1. Openness to FDI:
Starting a business in The Bahamas has been made increasingly attractive and easier by the local government. The government actively supports Foreign Direct Investments (FDI), particularly on the frontier of tourism and financial services. As a result, The Bahamas has formulated investment strategies that are supported across various national agencies to attract foreign investors. Each administration under the purview of the government has honoured both past and present investment agreements, culminating in the birth of the Small Business Development Centre (SBCD). With 85% of registered businesses in The Bahamas belonging to the category of “Small and Medium Enterprises (SMEs)”, the SBDC was developed in 2018 to provide business advisory services in order to accelerate and help SMEs mature. The various business advisory services include training, access to grants, incubation services as well as providing professional development services.
In The Bahamas, the government has also legislated reservation of certain sectors of the economy for foreign investors to conduct in. The international investment areas targeted includes but not exhaustive to: tourism resorts, upscale condominium developments, assembly industries and high-tech services, agro-industry and mariculture, banking and financial services, and others. The FDI efforts in The Bahamas are also further heightened given the occurrence of Hurricane Dorian (Cat 5 Atlantic Hurricane) and Covid-19 which disrupted and maimed the economy of the country. In April 2020, the local government established an Economic Recovery Committee (ERC) in hopes of evaluating and mapping the recovery road for the economy. The ERC is a partnership of public-private sector professionals focused on developing recommendations to address the impact of Covid-19 in The Bahamas. Certain administrations developed from the ERC coalition included the creation of entrepreneurship visas (visa that allowed people to work/study in The Bahamas for a year) and creating special economic zones on lesser developed areas. The various responses towards FDI makes starting a business in The Bahamas an advantage.
2.Tax Neutral Environment:
Many open company in Bahamas given its tax neutral environment, making the location a popular choice for many institutions and firms looking to prime their profits. The tax structure of The Bahamas is considered narrow given its focus on import duties fees as well as other excise taxes. For firms and entrepreneurs in The Bahamas, personal income and corporate income taxes (unless revenue is derived from within The Bahamas) are not exempted. Instead, the government receives inland revenue from other forms of tax imposition like: value-added tax (VAT), property tax, stamp duties, import fees and licensing fees. For firms starting a business in The Bahamas, the tax neutral environment is an advantage that is the most compelling reason amongst many for the choice of incorporation.
3.Transparent Regulatory System:
Legal and regulatory systems in The Bahamas remain transparent and are consistent with international standards and norms. Additionally, the government and local authorities are actively improving fiscal governance and practices, and are reforming public accounting practices to be aligned to international reporting standards. In March 2021, the government passed legislation that aimed to enhance transparency and accountability.
The legislation included several bills being passed:
1) The Public Debt Management Bill (2021) was passed to clearly outline proper debt management policies into law.
2) The Public Finance Management Bill (2021) was passed to broaden budgetary and fiscal reporting requirements for central government and state-owned-enterprises
3) The Statistics Bill (2021) was passed to transform the current Department of Statistics into a quasi-independent National Statistics Institute.
4) The Public Procurement Bill (2020), that allows for government contracts to improve transparency and accountability.
The transparent and progressive regulatory system is another advantage for starting a business in The Bahamas.
4. Investment Incentives:
On top of the attractive tax neutral environment that The Bahamas offers, the government has implemented many investment incentives to further attract foreign investors. The suite of investment incentives allows exemption on import fees of necessary materials needed for businesses to start up in various industries. Some of the investment incentives include The Hotels Encouragement Act, The Industries Encouragement Act and also The Tariff Act. Furthemore, a Free Trade Zone, Freeport, has been identified and is operated by the Grand Bahama Port Authority. In conjunction with The Hawksbill Creek Agreement Act, the port area enjoys freedom from all taxes until 2015 and excise taxes, stamp duties and most customs duties will be exempted till 2054.
Conclusion:
Engage Tetra Consultants to start your business registration in The Bahamas through a smooth and hassle-free process. The team provides a comprehensive service package that includes planning and strategizing with our clients to select a suitable business entity, completing the registration and documentation processes, obtaining required licenses, opening a corporate bank account, and ensuring your compliance with the government regulations.
Contact us to find out more about company registration in The Bahamas and our dedicated and experienced team will revert within the next 24 hours.
