Barbados Urged to Reform Tax System for Economic Growth, ICAB Official Warns

Barbados must overhaul its tax system or risk falling behind in the global economy, a key figure in the nation’s leading accountancy body warned on Friday.

Jason King, who heads the Institute of Chartered Accountants of Barbados (ICAB) taxation committee, criticised the country’s “outdated approaches, slow refunds, and unclear regulations” for discouraging investment and long-term financial planning.

Speaking at ICAB’s Annual Tax Update on Friday, King expressed disappointment at the lack of new legislation: “I had hoped that we would have new legislation so that our tax policy is not implemented by way of policy notes, as it has been for several years.”

King highlighted the shifting global tax landscape, noting that the Organisation for Economic Co-operation and Development (OECD) is now scrutinising incentives given to multinationals. He also pointed out ongoing issues with tax refund payments, saying, “We are still waiting for much-needed tax refunds to be paid.”

The international tax consultant criticised Barbados’ tax policies for discouraging savings and long-term investment. He argued that in the past, taxpayers could use financial strategies to maximise tax refunds and build personal savings, fostering financial security.

“Today, people are more likely to spend what they have now rather than invest, knowing they will be taxed on their pension in the future,” King said.

In response, Minister in the Ministry of Finance Ryan Straughn, who delivered the keynote address, defended the government’s tax policies, stating that despite economic pressures, Barbados has maintained “relative tax certainty.”

He said, “In spite of COVID, the climate crisis, and global tax changes, we have worked to provide stability.”

Straughn highlighted the convergence of tax rates in 2018, which aimed to provide certainty for the international business industry.

He acknowledged the uncertainty surrounding OECD-led tax reforms but maintained that Barbados remains committed to attracting international business while ensuring compliance with global tax frameworks.

“Taxation is not just about government revenue,” he said. “It also supports investment in human capital, which is why we have focused on creating an environment where businesses domiciling here can thrive.”

ICAB also criticised the lack of efficiency in tax administration, particularly regarding slow refund payments and regulatory uncertainties. King warned that these delays and inconsistencies weaken investor confidence: “The systems must be able to accurately process refunds. Refunds are a part of a tax system, and the government must ensure taxpayers receive what they are owed.”

Minister Straughn acknowledged these concerns and noted that the government has taken steps to improve communication and clarity on tax policy matters. He also called on businesses to be more transparent with their financial disclosures, arguing that this is necessary for attracting investment and ensuring tax policies are effective.

“When businesses hide from the BRA [Barbados Revenue Authority], NIS [National Insurance and Social Security Service], or government, it creates uncertainty,” Straughn said. “And because we don’t know what’s happening, there’s a level of opaqueness to any policy. If you want to grow, you have to be open . . . give information to the market such that it gives people the confidence to invest.”