Taxation
Corporation tax:
Incorporated, registered or continued companies are charged a 40% tax on profit.
Unincorporated businesses pay a 2% tax on gross income. However, the first $4,166 of gross income in any calendar month is exempt.

Property tax:
Residential - tax on residential properties is based on the current construction replacement cost of the property. In addition, there is a surcharge (0-20%) depending on zoning regulations.
Commercial - hotels are taxed at a rate of 1/5 of 1% of their taxable value. Other commercial properties must pay 3/4 of 1% taxable income.

Export duties:
Antigua and Barbuda does not impose any export duties, except for those on lobsters, sea island cotton, sugar, molasses and fish.

Offshore Business in Antigua and Barbuda
The Antigua and Barbuda Advantage...
Since its independence in 1981, the twin-island state of Antigua and Barbuda in the Caribbean has continued to practice a tradition of English Common Law.

Located less than 300 nautical miles Southeast of Puerto Rico, in the Leeward Islands. Its legal procedures are structured in accordance with strong democratic principles of good governance, patterned after the British parliamentary system. In 1982, legislation was enacted under the International Business Corporations Act, with subsequent amendments in 1984 and 1985, to make Antigua and Barbuda a choice jurisdiction for offshore banking. Operations under this Act are controlled by the Ministry of Finance in Antigua.

While Antigua and Barbuda is probably best known as an up-market destination for more discriminating tourists, its natural and developed assets have also allowed it to emerge as an attractive offshore business centre. The country is in a convenient time zone, sharing the same time as New York, Toronto, Central and part of South America, and falling five hours behind the UK and Europe in the summer and four hours in the winter which allows international business to be transacted easily within an appropriate time frame. Antigua's international airport is a major gateway for the Caribbean, serving British Airways, US Air, Virgin Atlantic, American Airlines, Air Canada, BWIA and LIAT, with direct flights from New York, Miami, Toronto and London. Its international telecommunications are excellent, with direct access into the global stream of financial and business data. Electronic funds transfer is readily accomplished, providing same day value, and securities can be placed and executed within 24 hours.

There is a prosperous English-speaking community, with a resident population of 80,000. Its people are involved primarily in business related to the tourism industry and in commerce. The country enjoys the highest per-capita income in the Eastern Caribbean. First-rate professional services are widely available, including banking, law, accounting, and management resources.
International commercial banking has been conducted on Antigua for many years. Offshore banking is more recent, having started in 1983. Since that time the industry has grown rapidly. Working in co-operation with the private sector, the Government has improved Antigua's offshore company and banking environment through the introduction of new foreign residency, trust, and partnership legislation.

International Business Corporations Act of 1982
The prevailing offshore legislation provides for speedy formation of international business corporations (IBCs) at very competitive charges. The formation can be carried out by a locally registered trust company or by an accountant or attorney. Formation can usually be completed within 24 hours and full corporate and trust services are available to both private and corporate investors including:
1. Registration and maintenance of corporate charters for offshore companies;
2. Reception, management, and disbursement of the assets of offshore companies;
3. Provision and maintenance of a registered office;
4. Maintenance of the company's records and statutory register;
5. Preparation of all necessary corporate returns and reports to the Director;
6. Provision of directors and officers on request;
7. Incorporation and management of offshore banks and captive insurance companies; and
8. A full range of traditional trust services.
Some of the benefits provided to offshore companies formed under the IBC Act include the full exemption of all direct taxes in respect of any international trading, investment or commercial activity including withholding taxes and stamp duties. For banking there is a 3% tax on gross income (i.e. interest income and fees derived from the operations and investments of the banking business minus interest expense). No minimum capital is specified for an IBC and shares may have a nominal or no par value. The transfer of the charter of an IBC to a foreign jurisdiction, or vice versa, is explicitly permitted. The board of directors of a corporation may consist of a single member. In the case of banking, trust and insurance corporations, at least one director must be a citizen and resident of Antigua and Barbuda.

Confidentiality Provisions
The IBC Act provides criminal penalties for any disclosure of the business affairs of customers regarding banking or trust matters. The only exception for the disclosure of information relates to sound evidence regarding an alleged criminal offence that is triable in Antigua (or which would have been triable, if it has been committed in Antigua).
There are specific advantages for Canadian entities to form an IBC in Antigua that generates an active business income, because dividends paid out of income earned in Antigua are considered to be paid out of exempt surplus. Antigua is one of the countries listed in the Canadian Regulation 5907 (ii) which allows this arrangement. There are no tax treaties with European countries, except in the case of the UK and this is being updated through negotiations.

Incorporation Procedures
Every IBC must have a registered office and a resident agent in Antigua. This function is regularly performed by the trust company or by the professional who performed the incorporation process. The resident agent is responsible for paying the annual government fees and for keeping the company in good standing. The annual government licence fee for an IBC is US$300; for an IBC licensed to carry on international banking it is US$15,000 and for an IBC licensed to carry on an international insurance business it is US$10,000.
Fees charged by trust companies or professionals for incorporation and annual maintenance will vary, but fees for the formation of an IBC without an international banking or insurance licence start at about US$725, with an annual maintenance fee of US$350. Thus the total cost for an IBC formation (including the government licence fee) is typically US$975, with an annual maintenance fee of US$600. If the applicant for an IBC wishes to have a registered agent serve as its corporate director, an additional fee will be charged, between US$250 and US$1,000 for each director.
Incorporation and maintenance fees for an IBC with an international banking or insurance licence are higher and may be related to the level of required management services. Fees for trust management services are also dependent on the nature and value of assets and the required level of service.

Ship Registry
shippingIn 1985, Antigua enacted the Merchant Shipping Act, which further expanded the facilities of its offshore centre. The designated port of registry in St John's, Antigua, is under the supervision of the Registrar of Ships, Department of Marine Services and Merchant Shipping. Registration can also be carried out in Germany by the Commissioner of Maritime Affairs, Department of Marine Services and Merchant Shipping, Patentbusch No. 4, 26125 Oldenburg, Germany.
The procedures for ship registration or parallel (bareboat) registration are efficient and can be organised through several of the offshore operators. With the submission of required documentation, the Department of Marine Services provides quick response. The registration fees are competitive with other jurisdictions and are transparent, with no hidden costs. No age is set for the acceptance of ships for registration, but all ships over 499GRT must be in class. The Department of Marine Services does not duplicate safety inspections, but complements and controls the work of class societies. Unlike some other registers, Antigua has no nationality requirements for manning vessels. For more information please see the Antigua and Barbuda international shipping register website at http://www.antiguamarine.com

Antigua and Barbuda's Financial Sector
Establishing a Financial Institution
An international banking licence to an IBC is granted at the sole discretion of the Supervisor of Banks and Trust Corporations. The supervisor may revoke the licence at any time if, in his opinion, the revocation is in the public's interest. The minimum capital requirement is currently five million US dollars or its equivalent in another major currency. However, it is exempt from any exchange control or foreign currency levy. IBC banks are required to appoint an auditor and to file unaudited quarterly returns and annual audited accounts with the Supervisor of Banks and Trust Corporations. The accounts are provided in a consolidated form.

Internet Gaming
Internet gaming facilities are deemed to be financial institutions under the law. They are regulated by the Financial Services Regulatory Authority (FSRC), which gives the internet gaming operators a high level of comfort in the jurisdiction and in the ability to conduct business on a predictable basis. It is useful to take note of the following points:
(a) A 3% tax is payable by operators on their "Net win" defined as "the difference between the gross stakes laid and the winnings paid out".
(b) Operators are entitled to deduct software licensing or software development costs from (a) above, capped at no more than 40% of the Net win for all companies provided claims for the deduction of such costs are accompanied by documentary support evidencing the costs.
(c) Operators are entitled to deduct charge backs on credit cards for a period up to 18 months after the original charge was made provided claims for the deduction of such charge backs are accompanied by documentary support evidencing the original credit and the charge back.
(d) The 3% tax on Net Win and the deductibles, as described at (a), (b) and (c) above, are fixed until 2006, after which they will be subject to review by the Government and the representatives of the Industry.
(e) Operators are entitled to a maximum cap of US$50,000.00 per month on taxes and the Commissioner of Inland Revenue would have no interest in the books of entities that pay the full cap. However, such operators are obliged to continue to maintain financial books and records and to provide access by the Government through its authorised agencies in the event of the need to examine such books and records in accordance with the laws of the State particularly the Money Laundering (Prevention) Act, the International Business Corporations Act and the Proceeds from Crime Act and their amendments.
(f) The maximum cap of US$50,000.00 per month on taxes and the terms and conditions described in (e) above would remain unchanged until 2004, after which they will be subject to review by the Government and representatives of the Industry.
(g) Gaming Licence fees are US$75,000.00 per annum for those Operators who maintain a primary server and operations in Antigua and Barbuda and who pay the tax as described above.
(h) Wagering Licence fees are US$50,000.00 per annum for Operators who maintain a primary server and operations in Antigua and Barbuda and who pay the tax as described above.
The internet gaming industry benefits from high quality telecommunication facilities provided by Cable and Wireless. The costs of such telecommunications are highly competitive and are lower than in the vast majority of jurisdictions which provide a home for internet gaming.

For more information on Antigua and Barbuda taxes go to:
http://www.antigua-barbuda.com/finance_investment/offshore_sector.asp

Antigua & Barbuda Offshore Banks
Antigua & Barbuda Offshore Company Formations