{"id":239136,"date":"2025-05-31T16:00:28","date_gmt":"2025-05-31T20:00:28","guid":{"rendered":"https:\/\/antiguanewsroom.com\/?p=239136"},"modified":"2025-05-31T16:00:29","modified_gmt":"2025-05-31T20:00:29","slug":"who-pays-the-bills-tax-and-revenue-realities-across-the-eastern-caribbean","status":"publish","type":"post","link":"https:\/\/antiguanewsroom.com\/who-pays-the-bills-tax-and-revenue-realities-across-the-eastern-caribbean\/","title":{"rendered":"Who Pays the Bills? Tax and Revenue Realities Across the Eastern Caribbean"},"content":{"rendered":"
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OP-ED<\/strong><\/p>

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THE UWI FIVE ISLANDS CAMPUS OECS BUDGET WATCH 2025<\/h3>\n\n\n\n

\u201cWHO PAYS THE BILLS? TAX AND REVENUE REALITIES ACROSS THE EASTERN CARIBBEAN\u201d<\/h2>\n\n\n\n

By Professor C. Justin Robinson<\/strong>
Pro Vice-Chancellor and Principal, UWI Five Islands Campus<\/p>\n\n\n\n

When governments spend, someone has to pay. Across the Eastern Caribbean, the who and the how of revenue collection are revealing\u2014and in some cases, worrying. As 2025 budgets roll out, the six countries face a common challenge: building fair, stable, and resilient revenue systems. But while some rely on a broad base of taxes, others lean heavily on volatile programs like Citizenship by Investment (CBI) or import duties from shrinking trade volumes. Let us unpack the region\u2019s revenue mix.<\/p>

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VAT: The Regional Workhorse<\/h3>\n\n\n\n

The Value Added Tax (VAT) is the dominant source of revenue across the ECCU. No surprise\u2014it is efficient, hard to avoid, and pulls in revenue as long as people spend.<\/p>

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Country<\/th>VAT as % of Total Revenue<\/th><\/tr><\/thead>
Saint Lucia<\/td>~30% (up to 45% of tax revenue)<\/td><\/tr>
Antigua & Barbuda<\/td>~30\u201332%<\/td><\/tr>
St. Kitts & Nevis<\/td>~30%<\/td><\/tr>
Dominica<\/td>~30\u201335%<\/td><\/tr>
Grenada<\/td>~50% of tax revenue<\/td><\/tr>
SVG<\/td>~25\u201330%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

VAT remains the fiscal backbone, and there\u2019s little appetite for raising rates. Instead, governments are doubling down on compliance. Antigua and Saint Lucia both launched crackdowns and amnesties; Grenada is digitizing systems.<\/p>\n\n\n\n

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Income Taxes: Present in Some, Absent in Others<\/h3>\n\n\n\n

A major divergence exists on personal income tax. Antigua and St. Kitts have no personal income tax. Their systems rely almost entirely on VAT, customs duties, and business taxes.<\/p>

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Grenada, Saint Lucia, Dominica, and SVG all retain income taxes, though collections vary.<\/p>\n\n\n\n

But direct taxes\u2014corporate and personal\u2014rarely surpass 20% of total tax revenue, even in income-tax countries. The region remains tilted toward indirect taxation, raising fairness concerns, especially as food and fuel prices remain elevated.<\/p>

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Trade Taxes: Still Hanging On<\/h3>\n\n\n\n

Import duties, customs charges, and fuel excises remain significant, particularly in St. Kitts, Saint Lucia, and Grenada. But they are shrinking in relative terms. As trade liberalization and exemptions expand, so too do tax gaps. Grenada, for example, cut its property transfer tax to boost real estate, while Saint Lucia slashed its airport service tax by 50% to stimulate tourism.<\/p>

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CBI<\/h3>\n\n\n\n

Four countries\u2014Dominica, St. Kitts, Grenada, and Antigua\u2014earn large non-tax revenues from Citizenship by Investment (CBI) programs.<\/p>\n\n\n\n

Country<\/th>CBI Role in Budget (2024\u201325)<\/th><\/tr><\/thead>
Dominica<\/td>Essential for funding airport, housing, energy<\/td><\/tr>
St. Kitts & Nevis<\/td>Plunged 2024 into deficit after CBI revenues fell<\/td><\/tr>
Grenada<\/td>Helped deliver 2024\u2019s large surplus<\/td><\/tr>
Antigua<\/td>A steady source of revenue<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

While CBI funds have allowed for massive capital investments, they are non-recurring and vulnerable to international scrutiny. St. Kitts is already under pressure to reform its CBI program. The IMF and Eastern Caribbean Central Bank urge countries to treat CBI as a bonus, not a baseline.<\/p>\n\n\n\n

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External Grants and Loans: The Hidden Hand<\/h3>\n\n\n\n

Some budgets\u2014especially in St. Vincent and Dominica\u2014lean heavily on external support. For example:<\/p>\n\n\n\n