Saint Lucia

Corporate - Other taxes

Last reviewed - 01 December 2023

Value-added tax (VAT)

The standard VAT rate is 12.5%. There is also a 0% rate charged on certain goods and services. In respect of the hotel sector and related services, the rate is 10%, with a reduced rate of 7% for a supply of a tourism accommodation service applicable from 1 December 2020.

The threshold for registered taxpayers is currently set at 400,000 East Caribbean dollars (XCD) per annum. This means that it is not mandatory for businesses earning less than the threshold to register for VAT. The threshold is based on the annual sales turnover of the taxpayer.

The VAT rate of 0% has been legislated on certain supplies, which include, but are not limited to, the following:

Goods to be exported.
Goods for sale at duty-free shops.
Fuel.
Water.
Electricity.

The following goods and services are exempted from VAT, but this list is not exhaustive:

Domestic residential rental.
Educational services.
Financial services.
Insurance services.
Medical services.
Local transportation services.
Certain food items (e.g. chicken, rice, milk, flour, bread).

The government secured the Caribbean Community and Common Market's (CARICOM's) approval to remove the import duty on medical supplies for a period of four years from 1 May 2012 to 30 April 2016. Although this was meant to be a temporary measure, the instrument instituting the exemption had no end date and there have been no official pronouncements terminating the exemption. Prescription drugs are currently exempt from VAT.

The government has established a special VAT Refund Account in accordance with the provisions of the Financial Administration Act to facilitate the timely processing and payment of refunds to taxpayers.

Customs duties

Customs duties are charged on a wide range of imported goods. Exemptions are granted for raw materials and plant and machinery used in manufacturing and for certain items imported by hotels under construction, extension, or refurbishing projects.

Excise taxes

Excise taxes are imposed on four main categories of goods manufactured or imported into Saint Lucia, namely fuel, liquor, beer, and cigarettes. Most excisable goods are subject to tax at a specific rate.

The excise tax on fuel applies when the fuel is imported by a wholesaler. Tax is included in the price of fuel paid at the gas pump. The tax rate formula is based on the current price provided by the supplier and regulated price at the gas pump.

Effective 1 July 2023, Saint Lucia has increased excise tax on tobacco products by 50%.

Commercial property tax

Commercial property tax is assessed annually at 0.4% of the open market value of the property. The owner is required to obtain a commercial valuation assessing the open market value of the property. All new commercial properties completed after 1 April 2001 can benefit from a three-year exemption from commercial property tax.

Residential property tax

The property tax rate for residential property is 0.25% of the open market value.

Stamp tax

Stamp tax is charged on any document that evidences a legal or contractual relationship between two or more parties. Additionally, many types of commercial and legal documents must be stamped as evidence of the payment of taxes. Stamp tax may be charged either at a fixed rate or at an ad valorem rate, depending, for example, on the value of the property being transferred.

Instrument	Stamp duty rate
Conveyance or sale of immovable property (resident or non-resident purchaser)	2%
Conveyance or sale of immovable property:
Non-resident vendor	10%
Resident vendor:
XCD 50,000 to XCD 75,000	2.5%
XCD 75,0001 to XCD 150,000	3.5%
XCD 150,001 and over	5%
Conveyance or sale of debenture, stock, debt, or shares where less than 75% of assets comprise immovable property	Greater of 0.5% of net assets of company or XCD 10
Conveyance or sale of debenture, stock, debt, or shares where more than 75% of assets comprise immovable property:
Non-resident vendor	10%
Resident vendor:
XCD 50,000 to XCD 75,000	2.5%
XCD 75,001 to XCD 150,000	3.5%
XCD 150,001 and over	5%

Payroll taxes

Other than employers’ portion of the statutory National Insurance Corporate (NIC) contributions (see below), there are no other payroll taxes, where the burden falls on the employer. Employers are, however, responsible for deducting the employees’ income tax liability at source, through the pay-as-you-earn (PAYE) system.

Social security contributions

The employee's share of NIC contributions (for retirement, sickness, and disability benefits) is 5% of gross salary, up to a maximum contribution of XCD 250 per month (i.e. on a monthly salary of XCD 5,000). The employer matches the contribution and files monthly returns.

Tourism levies

Effective from 15 December 2020, guests staying at registered accommodation service providers will be charged 3 United States dollars (USD) per person and night on room rates below USD 120 or USD 6 per person and night on room rates above USD 120. A rate of 50% of the tourism levy will apply to guests who are 12 to 17 years of age.

Health and Citizen Security Levy

Saint Lucia has introduced a 2.5% Health and Citizen Security Levy, effective 2 August 2023, on:

the importation of goods
the provision of certain services by a VAT-registered taxpayer in Saint Lucia, and
the provision of certain services by a non-resident to a VAT-registered taxpayer in Saint Lucia.

The levy is to be applied ad valorem on the cost, insurance, and freight value of goods. It is to be applied to invoices generated for goods and services effective 2 October 2023.

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