On 14 July the House of Assembly passed the “Tourist (Duty Free Shopping System) Act, 2015”, which will seek to establish a tourist duty free shopping structure by making duty concessions on goods and to provide for related matters.
Presenter of the Bill, Premier Dr. the Hon. D. Orlando Smith said that the whole question of duty free shopping has been around for a long time. Hon. Smith stated that the Act that was passed on Tuesday allows for duty free offering in various parts of the Territory as any place that the Minister so desires can be declared as a duty-free shopping zone.
Hon. Smith explained that the way the system works is that persons who purchased items within the duty-free zone would not be required to pay duty on those purchased items. It was noted that the provision is mainly for visitors.
“The duty-free system that operates in many countries produced economic benefits to those countries…the economy of the BVI will likely benefit from the introduction of this system,” the BVI Leader added.
Territorial At Large Representative, Hon. Archibald Christian announced that the legislation has been long in coming, and that the true need for the duty-free Act is now, mainly because the Territory has embarked on a major investment with the cruise port facility.
Hon. Christian said that he did some research about duty-free shopping in the world and learned that the neighbouring territories of the United States Virgin Islands and St Maarten are two of the most competitive duty-free destinations in the world. He also noted that the BVI is right in the middle of the competition.
The At Large Representative pointed out that something is obviously beneficial to having duty-free shopping in tourist destinations, and noted that many destinations have such system: “Most of these duty-free facilities are located in airports and seaports, but they’re also located in other areas. You would find that they are located in zones that have been established for duty-free shopping, in malls and in other areas that any government deems fit for them to exist in order to generate commerce.”
“I think one of the important aspect of this bill is for persons to be able to apply to the Premier to operate duty-free stores in areas that the Premier deems fit for duty free shopping,” Hon. Christian said.
He announced that the duty-free Act will lead to additional job creation in the industry, and also mentioned that there are 44 approved goods in the Act to be duty-free.
As a word of caution the Legislator said: “There will always be instances where adjustments will have to be made to ensure that everybody benefits, because we have stores in other locations in the BVI that cater to tourists. I am sure that in the spirit of the Bill the Premier will pay closer attention to those locations to ensure that persons can take advantage of the duty-free system.”
Minister for Education and Culture, Hon. Myron Walwyn supported the Bill and announced: “We are finally getting to a point where we can project what the Virgin Islands has to offer. Not that we are saying come to Tortola buy something and when you read the bottom of it says Made in China. It is an opportunity for us to position ourselves to create new businesses in the country.”
Hon. Walwyn said that the new legislation is putting the Territory in a very competitive position with destinations such as the USVI, St Kitts, and St Maarten. The Minister said that tourists now have confidence that they are getting good products and prices, and he declared that the Territory should see the spinoff from this in the overall economy. “This is another initiative that is geared towards improving things here in this Territory,” Hon. Walwyn added.
Ninth District Representative, Dr. the Hon. Hubert O’Neal said that he hopes the legislation will be implemented quickly and also noted that it will put the Territory in a competitive position alongside the USVI and St Maarten: “We will be certainly on the map and in the game,” he added.
Second District Representative, Hon. Mitch Turnbull agreed that the legislation puts the Territory in a great position in the tourism competition.
Eighth District Representative Hon. Marlon Penn shared the view of the other legislators and announced: “We are now a real player in this industry!” However, he stated that there were aspects that concerned him. “I am concerned more specifically about the abuse of the system. Many of the items that are listed on the list are items that are sold throughout the Territory, and I am sure some of the merchants or some of the business owners that are operating in that space are also gonna be operating outside of the duty free zone. We have to ensure that we put the necessary mechanisms in place so that we don’t have abuse of the system, because you don’t want persons having an unfair competitive advantage to their other competitors within the economy, we have to be mindful of that. We have to, as they say, look with eagle eyes to what’s happening in terms of the goods that are coming in to ensure that we have fairness in terms of the other businesses that are operating in this environment,” the Eighth District Representative stated.
Minister for Health and Social Development, Hon. Ronnie Skelton shared Hon. Penn’s point by noting that the legislation provides for penalties for persons found contravening. “Those responsibilities should come with a penalty probably taking away your license for a time,” he suggested.
Minister for Communications and Works, Hon. Mark Vanterpool announced that Premier Smith moved quickly and swiftly to bring the Bill to the House to ensure that the Territory remains on top in the highly competitive tourism industry. “When tourists come to the BVI they can enjoy duty free shopping as they do in the Caribbean and the rest of the world,” he noted.