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Aruba implements 12.5% VAT 2023

Dutch Caribbean dependancy joins Value Added Tax club in exchange for COVID-19 funding

The Caribbean island of Aruba is to introduce a Value Added Tax at 12.5% from January 2023. This will replace the existing 6% combined Turnover Tax (BBO) and Health Tax (BAZV). This is based on support from the OECD on the design of the new indirect tax.

Aruba, along with Bonaire and Curaçao are part of the Netherlands. It is largely dependant on tourism. The new tax is being coordinated with the Dutch, who tied the new indirect tax to the funding package provided during the COVID-19 pandemic.

The average VAT rate for the Caribbean Islands is 16%.

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