Tax Holiday

Tax Holiday was introduced to broaden the economy of the Netherlands Antilles and to give companies enough facilities to grow in the first year of establishment. Tax Facilities are the exemption or reduction of taxes for enterprises. These enterprises are:

New business initiatives or companies, which are going to build hotels and companies that manage hotels, accommodations or other recreational facilities
Industrial enterprises
Companies that develop land
Companies that renovate hotels

In the following text a summary is given of the ordinances of the Central Government. This summary will give you information about the requirements for the above-mentioned businesses to be eligible for Tax Holidays.

1. The Ordinance of the Central Government to Promote the Establishment of Enterprises and the Building of Hotels.
The Ordinance of the Central Government to Promote the Establishment of Enterprises and the Building of Hotels defines businesses as: companies that want to establish or manage hotels, accommodations or other recreational facilities. The Ordinance of the Central Government contains a few specific requirements for:

New business initiatives
Businesses that build or operate hotels, accommodation or other recreational facilities

The next paragraphs will give a description of these requirements.

A. New businesses initiatives:
New business initiatives are eligible for tax facilities if they:

contribute to the broadening of the economic base of Bonaire
are going to invest at least NAf. 150,000
provide permanent work to at least five natives

B. Businesses that Build or Operate Hotels, Accommodation or other Recreational Facilities:
Businesses which build or operate hotels, accommodations or other recreational facilities and concentrate on promoting tourism to Bonaire are eligible for tax facilities if they:

contribute to the broadening of the economic base of Bonaire
invest at least Naf. 500,000

The investments have to be realized in two years time from the date issued on the Central Government Decree. The businesses have to be Limited Liability Companies established on Bonaire.

Exemption or Reduction of Taxes:
According to this Ordinance of the Central Government, tax exemption or reduction can be granted up to eleven years on the following taxes:

import duties on materials and goods
the materials and goods need to be used for construction and primary furnishings of the business premises and reserved for the purpose of the business. Exemption can also be given on import duties of raw material and semi-manufactured products processed by the company
land tax
reduction can be given on profit tax--the normal levied 34,5 % profit tax will be reduced up to a levied minimum of 2%.

2. The Tax Facility Ordinance of the Central Government for Industrial Enterprises
The tax facilities ordinance of the Central Government for Industrial Enterprises defines industrial enterprises as businesses which:

process or assemble goods into a new or semi- manufactured sales product
add value to the sales product

Only companies with these characteristics are considered as industrial enterprises according to this ordinance. The Ordinance of the Central Government contains a few specific requirements in order for these companies to be eligible for tax facilities. The next paragraph will give a description of these requirements.

Industrial Enterprises:
Industrial enterprises are eligible for tax facilities if they:

have invested or are going to invest at least NAf. 150.000
provide permanent work to at least five natives
contribute to the broadening of the economic base of Bonaire

Exemption or Reduction of Taxes:
According to this ordinance of the Central Government, tax exemption can be granted for a period of up to eleven years on the following taxes:

import duties on materials and goods
The materials and goods need to be used for construction or establishment of the company
import duties on packing and raw material, machines, semi-manufactured products and other means for production
land tax
reduction can be given on profit tax--the normal levied 34,5 % profit tax will be reduced up to a levied minimum of 2%.

3. The Ordinance of the Central Government for the Renovation of Hotels
The Ordinance of the Central Government for Renovation of Hotels defines businesses as: companies that manage hotels, accommodations or other recreational facilities, which concentrate on promoting tourism to Bonaire and want to do some renovation.
The Ordinance of the Central Government contains a few specific requirements for these companies to be eligible for tax facilities. The next paragraphs will give a description of these requirements.

Companies that want to Renovate Hotels:
According to this Ordinance of the Central Government for the Renovation of Hotels these businesses have to invest at least NAf. 50.000 on expansion, improvement or renovation of a hotel to be eligible for tax facilities.

Exemption of Taxes:
According to the Ordinance of the Central Government tax exemption can be granted for a period of up to two years on the following taxes:

import duties on materials and goods for expansion, improvement or renovation of a hotel.

4. The Ordinance of the Central Government to Promote Land Development
The Ordinance of the Central Government to Promote Land Development defines enterprises as:

companies which are Limited Liability Companies that want to develop big premises of fallow land by construction of roads and/or real estate
The ordinance of the Central Government contains a few specific requirements for these companies to be eligible for tax facilities. The next paragraph will give a description of these requirements.

Companies that Develop Land:
These companies can be given complete or partial exemption or reduction of taxes if they:

invest at least NAf. 1.000.000 in the development of land exclusive the value of the land in a time frame of five years
provide working possibilities for natives
enlarge the economic base of Bonaire

The premises have to be property of the company.

Exemption and reduction of Taxes:
According to this ordinance of the Central Government, tax exemption can be granted for a period of up to fifteen years on the following taxes:

import duty on materials and goods
the material and goods need to be used for the building of roads, constructions or recreational facilities on the premises stated by the Decree of the Central Government
land tax
reduction can be given on profit tax--the normal levied 34,5 % profit tax will be reduced up to a levied minimum of 2%.

Tax Facilities Request Procedure:
The request for tax facilities has to be submitted to the Governor of the Netherlands Antilles on a specific form that is available at DEZA and the Directorate of Taxes. The interested parties are obligated to fill out all the necessary information for the evaluation of the application and to add a stamp NAf 25,- on the application form. Stamps can be bought at the Collector’s office. It is recommended when sending the request to the Governor of the Netherlands Antilles to also C.C. the request to the Committee of Tax Facilities of Bonaire. The Committee of Tax Facilities is situated at DEZA.

For further information about tax facilities feel free to contact DEZA.

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