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The Bahamas' Ministry of Finance has clarified that local charities and non-government organizations will be exempt from VAT, and refunds will provide some relief against VAT incurred on inputs in relation to their charitable activities.
The Bahamas' Financial Secretary, John Rolle, stated: "It has to be emphasized that charities, such as the Humane Society, should be largely shielded in how they are impacted by VAT. The services that they deliver will be VAT-exempt under the provisions of the legislation and eligible charities will be able to claim a refund of VAT paid on the acquisition of certain goods and services."
"Eligible charities will need to meet the criteria for eligibility set out in the VAT Regulations. As charities are not uniform in their service and financial profiles, the guidelines and VAT rules about to be issued by the VAT Department will provide more clarification on how their operations will be treated. More than a dozen of these Guidelines are already in draft form and we are receiving preliminary feedback on them before they are more widely publicized."
Marvin Clarke, Project Manager for VAT implementation, added: "The VAT Project Implementation team is making available a number of guides to the VAT legislation and associated rules and regulations that will guide the process once the VAT program is implemented. In the coming weeks these will be issued to supplement the general Guide that is already found on the Government's website. The VAT guides are living documents that will expand as the need for additional clarification is expressed by the public."
The Bahamas is to introduce a value-added tax with a 7.5 percent headline rate from January 1, 2015.
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