Senate Debates Tax On Land Transactions For Foreigners - 07/07/17 10:25 AM
Two of the Bills garnering wide debate were the Stamp Duties Amendment Bill and Economic Development Council Bill. The former deals with stamp duties chargeable on transfers of land, particularly for non-Belizeans. While it is primarily an economic measure, concerns have been raised as to whether the country is shooting itself in the foot and driving away potential buyers. The Government including Attorney General Michael Peyrefitte and Minister of State responsible for Natural Resources, Carla Barnett, was quick to shoot that theory down, although Dr. Barnett concedes that there is work to be done to fix the broken system.
Mark Lizarraga, Senator, Business Community
“The Belizean realtors remind us of the context within which this Amendment finds itself; I won’t list all of the points but here are some of them that we believe are noteworthy. Real estate transactions in non-tourist driven markets are already down. We are already discussing an increased rate on a tax system that is already flawed, and as people in the industry claim, with no sign of being rectified; a system that is adding a firm and official increase in costs on top of a system that has steadily been raising the level of risk in investing and purchasing property in Belize. The system has led to a lot of corruption, and there is even question – as we all know; when we talk about risk of investing and buying property in Belize, there is even question and doubt in many instances as to who actually owns the very land that you are purchasing, so we are already in a high-risk environment. We’ve had a host of issues with titles from the Department; I’m sure the Minister will be talking about that too. In the end, Mr. President, the realtors of this country say that all we are really doing is bringing down the value of property in Belize – property not owned solely by foreigners, but as well Belizeans.”
Michael Peyrefitte, U.D.P. Senator
“There is a concern from Senator Lizarraga that somehow the value of Belizean land will go down, and there will be a reduction in the demand for Belizean property; Senator Lizarraga, I can tell you, there is no such thing as a lack of demand for Belizean property. Belizean property is demanded heavily by both Belizeans and non-Belizeans; that will not be affected. As a matter of fact, The Minister informs me that demand has increased steadily since she has taken over the Ministry.”
Carla Barnett, U.D.P. Senator
“With particular reference to the way the Stamp Duty Act works, as has been identified by my colleagues, there is a process that takes place that I will call out; and as I have done within the Ministry and outside, I will call that out as a process that needs to be reviewed, revised, and we are doing that. Because when you purchase land – sell land one to the other – there is a process in the ministry where the valuation needs to be looked at for determination of the appropriateness of the stamp duty that is to be paid. And it’s a process that right now takes a long time; that leads to a lot of discussion back and forth; that leads to a lot of requests for reconsideration, and as some of my colleagues have said, it opens the door for some amount of corruption in the system. And we’re trying to address that on various levels: we’ve actually met with the real estate sector already and a lot of what you said, Sir, had been conveyed to us directly, and we have agreed in principle that we would want to share information – they did offer to share information on prices and we have accepted that offer, but we have to work out how that actually comes into effect.”
Senator Barnett also announced plans to look at the issue of valuation of property and fixing the protocol for the process.