Antigua and Barbuda

The independent nation of Antigua and Barbuda is a member of the Commonwealth. Queen Elizabeth is the Head of State, represented by the current Governor-General. The islands are located in the British Leeward Islands, about 250 miles East of Puerto Rico.

The Government ruling party is the United Progressive Party, under the leadership of Prime Minister Baldwin Spencer. The party attained leadership in an election in 2004. The government was elected on a mandate of fiscal discipline, transparency and good governance.

Antigua is 108 sq. miles, while Barbuda is 62 sq. miles. The population is about 70,000 with almost half living near the capital St. John's. English is the national language. The religion is Christian, mostly Anglican.

The currency is the Eastern Caribbean Dollar which is nominally pegged to the US Dollar at EC$1=US$2.67.

The climate is tropical. Average annual temperature is 75 deg. F (24 deg.C). Winter and summer temperatures vary by a few degrees and jumpers/jerseys are seldom required. Antigua is dry and rainfall is on average 46 inches a year.

Infrastructure consists of over 750 miles of roads in various conditions. While roads are improved on a regular basis I would recommend a four wheel drive vehicle for easy access to the more remote, and most pristine, beaches. The airport is being extended to cope with ever increasing passengers and planes. A desalinisation plant provides water additional to the main dams. Drilling is being undertaken to provide more wells. Most houses have water tanks or cisterns to cope with the dry periods. Electricity and telephones reach along all the main routes and most villages. Generators and solar panels are common sources of supply outside of these routes. Mobile phones are in common use, the Internet is available and the islands are linked by fibre optic cable. Satellite television is available. Postal services are regular. DHL and Federal Express have services too.

Tourism is the main economic activity. Over half a million tourists visit on Cruise Liners. Heritage Quay and Redcliffe Quay are duty free zones to actively encourage visitors to spend. Many thousands of tourists fly in to the hotels on the island. Some of these are all inclusive resorts. Foreigners have also purchased their own houses. Villas are available for rent. The English Harbour area has a Winter Season of visiting yachts and caters to several thousand nautical visitors. The main tourist events of the year are Antigua Classic Regatta and Sailing Week in April and May; Carnival in July and August; and Antigua Yacht Show in December. Of course the West Indies Cricket team always draw supporters and there are numerous other events.

Offshore Banking was legislated in 1982. Full tax haven facilities are provided to International Business Companies, trusts, banks and insurance companies. Antigua has recently co-operated with the international community in changes to prevent money laundering. Regular banking services are also available.

Internet Gaming provides hundreds of highly skilled jobs and large fees to the government. This sector is under pressure from US regulations aimed at preventing US citizens from gaming. Call centres have also been established to provide cheaper alternatives for US companies.

The Manufacturing, Retail and Industry Sector is small, but growing steadily. Many incentives are available to encourage investments in this sector. The growth of this sector is also hampered by import regulations and duties. Construction is currently steady with the main hospital, government buildings and airport being the biggest projects. Agriculture and fisheries account for small scale enterprise only.

Antigua and Barbuda is introducing Income Tax: Currently income tax rules are being changed. A new tax structure is due to be introduced by April 2005. Current indications are on a sliding scale from 10% over a wage of EC$ 3,000 per month to a high of 25%. Incorporated Company Tax is currently 35% on profit and may be reduced to 30%. Non-Incorporated Business Tax is 2% on Gross Turnover and this may remain. The Income Tax (Amendment) Act of 2002 may indicate that gains arising from the sale of capital assets will now be taxed. This was previously not the case. There is no inheritance tax. Legal advise should be sought to confirm your full tax compliance. Current taxation is under review to improve the fiscal position of the nation.

Import Duties are levied on most imported items. Import duties in the form of customs duty and consumption tax are high. CARICOM countries are exempted from certain duties. Basic foodstuffs and agricultural goods are excluded. Other items may be excluded by agreement with the government (often as an investment incentive). Some import duties are being reduced to comply with new regional trade agreements (hence the urgency of introducing income tax).

Hotels and restaurants include a 7% tax on all bills (Service Charges of 10% are also common). There are no general sales taxes or value added taxes.

Non-citizens require a license to buy property. The fee is 5%. Property stamp duties are payable by the buyer at 2.5% and the seller at 7.5%. The sale of businesses without property attracts no duty, unless the sale involves the transfer of shares where the stamp duty is 2.5%. There is no title insurance- properties are registered at the land office. Legal costs are between 1%-2%. Actual property taxes, or rates, are low and based on rental value. Insurance coverage costs approximately 1% (deductabile is 2%). Bank financing is available but local rates of interest are 13%-14%. Cash purchases are an advantage as there is a local 5-year recurring advanced tax of 3% on the mortgage balance for all non-resident buyers. Non-citizens are required to build on purchased land within one year of receiving title. The Land Title Certificate can take up to several months to be completed.

Land parcels are available from US $1.50 to US $15.00 per sq. ft. Building costs can range from US $80 to $150 per sq.ft. depending on materials used. Quality builders and architects are available. Wood and concrete blocks are the most common construction forms.

The Cost of Living on Antigua is regarded as relatively high. For the same reason Antigua has remained less spoiled and less developed than other islands. Wages are high and crime is reasonably low. Citizens regularly take shopping trips to nearby St. Maarten or Puerto Rico to take advantage of lower prices. The standard of living is high for most people. Antigua and Barbuda no longer qualify for IMF or World Bank support. The local labour pool is complimented by other islanders who undertake many of the more menial jobs. Antigua is, in my opinion, value for money. Below is a price list of goods.

Other Antigua and Barbuda Web Sites:
www.antigua-barbuda.com
www.antiguanice.com
http://www.countryreports.org
http://www.cia.gov/cia/publications/factbook/geos/ac.html#top

Contact: Anthony Todd at Caribbean Business Brokers.
ant@caribbizbrokers.com