|28-2014-Chamber: Aruba may convert into ‘hub’ if investment climate improves|
Oranjestad, The Chamber of Commerce & Industry had a meeting with His Excellency, the Prime Minister of Aruba, Mr. Eman, last Tuesday, October 14th, on the concept of Aruba as a gateway for commerce between Europe, Latin America, and the Caribbean region. The Chamber holds the point of view that, if Aruba should have a future as a gateway, this would be intimately related to a drastic improvement of the investment climate in Aruba, and this was also the main issue discussed in the meeting with the Prime Minister.
Among other themes, reference was made to the fiscal regime, which at this point in time does not look very attractive: we have the international reputation of having the personal income tax with the highest tariff of the world (nearly 60%), our corporate income tax is relatively high (28%), on top of this we have a dividend tax that most of our competitors in the region do not have (e.g. Curacao and St. Maarten). This may be improved by eliminating dividend tax, and reducing direct taxes like corporate and personal income taxes, collecting more from indirect taxation through turnover tax, Value Added Tax, or other forms of indirect taxation. However, it should be stated that the Chamber is not in favor of a bank transaction tax, as announced by government, which will be explained in detail in another publication that will be issued shortly, as this a theme on its own.
Also, extensive discussion was held on the improvement of several procedures for application for permits, both for enterprises as well as for personnel. Here, the Chamber suggested to consider converting these procedures in such a way, that when a citizen (or enterprise) does not receive an answer on a petition after the expiration of the term set for this procedure, the permit shall be granted automatically by law. This will help to eliminate the current procedures that sometimes take months, which is of great nuisance to the private sector.
The problems enterprises encounter with bank procedures were also brought to the table. It often happens that opening a bank account takes several months, because of the excessive previous checks taking place, and also the excessive checks on transactions banks are obligated to implement in order not to have problems with the supervising authorities (Central Bank, and supervising authority for unusual transactions, MOT). The Chamber is very satisfied with the Prime Minister’s commitment to organize a consultation among different stakeholders in this matter, in order to find a solution that may satisfy all parties involved.
It was also agreed, in light of the observations from the Chamber’s side, that an effort would be made in order to achieve a greater participation of small local entrepreneurs in the “Green Aruba – Europe Meets the Americas” event, by charging an entrance fee that would make their participation more feasible, and by organizing a networking event to stimulate contacts among local entrepreneurs and foreign companies.
By means of a letter, dated October 17, 2014, the Chamber announced to the Prime Minister that the Chamber is willing to endorse the Green Aruba – Europe Meets the Americas event, on the condition that government will commit itself to, together with other stakeholders, starting to address the issues brought forward by the Chamber, in order to achieve the improvement of the investment in Aruba for all investors, both local and foreign. The Chamber has drawn up an extensive list of issues that deserve attention, the addressing of which will contribute to a better investment climate, and to more ease and transparency, both for the entrepreneur as well as for the individual citizen. The Chamber will publish shortly this list of issues, and next, address in separate press releases, each item during the upcoming months.
Aruba, October 17, 2014
Chamber of Commerce & Industry