Recent amendments to the Small Business Development Act have provided registered incorporated small businesses with a number of incentives and an added fillip to their operations.
According to the Business Development Unit of the Ministry of Commerce, and Business Development, these incentives run the gamut from the payment of corporation tax at the rate of 15% on the profits of the business and exemption from import duty on raw materials, plant and equipment imported for use in the business, to exemption from withholding tax on dividends and interest earned on investment in an approved small business or in any fund approved for investment in small businesses.
In addition, there is the exemption from the payment of stamp duty, under the Stamp Duty Act, on all documents related to business where the registration of those documents is required by law; and a deduction of corporation tax of an amount equal to 20% of the actual expenditure incurred in respect of the use of technology, market research and any other activity that is, in the opinion of the Commissioner of Inland Revenue, directly related to the development of the business.
The Act was first passed in December of 1999, and its amendment has re-defined a small business as any enterprise that satisfies two of the following criteria: is incorporated under the Companies Act of Barbados; has not more than $1,000,000.00 as stated or paid up capital; has not more than $2,000,000.00 in annual sales; and employs not more than 25 persons.
Chief Business Development Advisor, Francine Blackman, is encouraging small businesses to become incorporated, so that they can access not only these incentives but also technical assistance from the Ministry.
It was also revealed that for the period 2000-2007 there have been 59 registered approved businesses.
Copies of the amended Act are available from the Government Printery.