Reason To Invest In Belize
- No Capital Gains Tax
- Fee Simple Title
- No Inheritance Tax
- Ownership Same for Citizens and Non-Citizens
Opportunities To Invest In Belize
The government of Belize aims to provide an enabling environment for private enterprise, to attract investments in Belize by both local and foreign investors. A series of legislation was enacted in the early 1990s to allow for a range of incentives for those looking to invest in Belize. The conditions to qualify for the different incentives vary, as do the investment incentives themselves–e.g., a tax holiday, or import duty exemption, or a combination of both. Benefits, however, are dependent upon the type of incentive awarded to the potential investor.
Export-oriented activities, which lead to increased employment, and the development of local, technological infrastructure, are particularly favorable to the authorities. The government supports joint venture and partnership investments as a preferred mechanism, however it also allows 100% foreign ownership of an enterprise. Importation of highly skilled personnel to compliment the Belizean labor force is facilitated providing that appropriate training programs for nationals are established. Generally, the government hopes to see one local counterpart assigned for every skilled foreigner employed by the company.
Investment Incentives In Belize
Belize benefits from trade agreements with several developed countries. These include:
- Preferential market access to the Caribbean Common Market (CARICOM)
- Preferential treatment from the U.S. under the Caribbean Basin Initiative (CBI)
- Under the Lomé IV Convention it has duty-free access to the EU for certain commodities such as bananas and sugar
- Certain Belizean goods enter Canada duty-free.
The Government Of Belize’s Investment Incentives
The Belize government offers a number of incentives to attract inward investment. These include:
- 100% foreign ownership of land and company assets
- Encouragement of joint ventures with local entities
- Special incentives for retirees.
Take A Tax Holiday
The Fiscal Incentives Act 1990 relates to tax holidays and duty.
The tax holiday period shall normally be for a five-year duration from the date of production. However, there is a provision that the Minister for Economic Development can, on application by the company, in a fit and proper case, review the company’s operations and renew the tax-holiday period for a further term not to exceed 10 years.
In addition, a company that is engaged in agriculture, agro-industrial products, mariculture, etc. whose operation is strictly for export, and is highly labor intensive, can receive a tax holiday of up to 25 years. Incentives under this particular clause in the Act also allow exemption from income tax under the Income Tax Act, including the repatriation of profits and dividends.
The Act allows duty exemptions to companies that are granted an Approved Enterprise Order (Development Concession) to import items into Belize, free of import duty, and revenue replacement duty. Such items include: building materials, plants, machinery, equipment, specialized tools, utility and transport vehicles, fixtures and fittings, office equipment and appliances, spare parts for plant, plant-related machinery, agricultural machinery, and any raw materials, or other items for the sole use of the approved enterprise.
The duty exemption period is for up to 15 years, with a potential extension of 10 years, subject to ministerial review. Several factors are considered when looking at an extension proposal: local value addition, profitability on investment, foreign exchange earnings or foreign exchange savings, creation of employment, transfer of new technology, location of industry, destination of the final products, and level of investment.
In addition, Belize enjoys the stability of a long-standing, democratic tradition, and has an independent judiciary. The country’s exchange rate is now fixed for 25 years. Repatriation of profits and dividends is the norm here.
Belize’s Export Processing Zones
For certain types of businesses, Belize’s Export Processing Zones (EPZs) provide substantial benefits to investors. Investors who take advantage of EPZs are often in the business of tourism, agriculture, mariculture, distribution, and light industry.
For Belize, the benefit of these free-trade zones is a way to encourage foreign trade and investment.
For investors, the advantages include:
- Exemption from import and export duties as taxes on capital gains, property, sales and consumption, trade turnover, foreign exchange, and transfers
- An income tax holiday of 20 years with an option to extend and deduct losses from profits following the period of the tax holiday
- Dividend tax exemption in perpetuity
- The opportunity to open foreign currency bank accounts in Belize and abroad
- Exemption from the Supplies Control Act and its regulations
In addition, EPZs aren’t burdened with restrictions on raw materials or export licensing requirements.