Focus on Barbados Budget 2005/2006

TAX A DVISORY S ERVICES 

J ANUARY 2006 

<strong>Focus</strong> on Barbados 

Budget 2005/2006

B UDGET 2005/2006 ECONOMIC A NALYSIS

Barbados Economic Proposals 

2005/2006 

The Barbados Economic Proposals 

2005/2006 is based on the Economic Policy 

Statement delivered by the Prime Minister 

and Minister of Finance, 

the Right Hon. Owen S. Arthur, M.P., 

in the House of Assembly on 

Monday 16th January, 2006. 

This review was prepared by 

Ernst & Young and is intended for the 

information of our clients and associates. 

Ernst & Young Caribbean 

Worthing, Christ Church, 

Barbados, W. I. 

Tel: (246) 430-3900 Fax: (246) 430-2079 

Email: ey.caribbean@tt.ey.com 

Website: www.ey.com/caribbean 

January 17, 2006

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B UDGET 2005/2006 ECONOMIC A NALYSIS

Table of Contents 

Page 

Oil Prices And The Barbadian Economy 1 

Legacy Benefits of Hosting ICC Cricket World Cup 2007 5 

Amalgamations Under The Value Added Tax Regime 8 

Business Facilitation: Time to Put Words into Action 10

Oil Prices and the Barbadian 

Economy 

Introduction 

The recent increases in the price of oil has come as a shock to Barbadian businesses and is 

reminiscent of the oil price shock experienced in the late 1970s early 1980s. Then the average 

price of oil rose from $26 per barrel to $60 per barrel in 1979 and reached as high as $80 per 

barrel in 1980. This resulted in unprecedented levels of inflation in Barbados. For example, 

in 1978, the average rate of retail price inflation was approximately 11 percent and in 1979 it 

reached 16 percent. Government's fiscal balance went from -3.2 percent in 1978 to -3.9 

percent in 1979 and -5.8 percent in 1980. 

While part of this deterioration was due to other factors such as rising expenditure on wages 

and salaries and transfers and subsidies, the worsening in government's fiscal accounts 

occurred principally through lower government revenue due to minor tax changes. The goods 

balance on the external current account rose by 7 percentage points to 40.5 percent of GDP, 

as fuel imports more than quadrupled. Therefore, on the basis of past experience, it is clear 

that the recent increases in the price of oil will most likely impact on inflation and the external 

balance of Barbados. 

The most recent rises in international oil prices can be attributed to three major factors: strong 

demand, supply constraints and speculators. With the three major industrial economies - the 

US, Japan and Europe - coming out of an economic slowdown and as China and the other 

Asian countries employ a greater amount of oil to power their manufacturing and expanding 

car markets, the International Energy Agency (IEA) estimates that in 2004 world oil demand 

rose by the greatest amount in 24 years. 

Unfortunately, supply is struggling to keep pace with demand. New product investment in 

particular has been disappointing. Whereas between 1996 and 2004 an average of 11.4 billion 

additional barrels of oil was found per year, only 6.8 billion per year was retrieved between 

2001 and 2003. Added to this, supplies from Iraq have continued to be low due to terrorists' 

attacks, major producers such as Nigeria and Venezuela have had to cope with political 

unrests and strikes, and production from the Gulf of Mexico has been cut due to the effects of 

hurricane Ivan and more recently, Katrina. This propensity for sudden price changes has also 

opened the door for hedge funds and other speculators. However, by betting on the possibility 

of higher prices these investors have themselves exerted upward price pressures on the 

market. 

1 B UDGET 2005/2006 ECONOMIC A NALYSIS

How Do Oil Prices Affect the Economy? 

Effects on Inflation 

There is a strong link between oil prices and domestic inflation in most countries. Rising oil 

prices have a direct impact on domestic inflation through increases in the costs of electricity 

and the price of fuel at the pump. However, oil prices also indirectly influence inflation 

through higher prices of imported and domestically produced goods and services. 

The larger the share of energy products such as fuels, electricity and gas in consumption 

expenditure the larger the direct impact on the retail price index (RPI). At present, the weights 

attached to energy products in the calculation of the RPI in Barbados suggest that they 

account for 11.3% (6.3% from fuel and light and 5% from petrol and oils) of total 

consumption. Therefore, if the domestic price of energy products rises by 10%; overall 

inflation would increase by just 1.1% assuming all other factors remain constant. 

Changes in oil prices also have an indirect effect on the RPI, as the prices of those goods and 

services that use energy in their production process will also react to the increased cost of 

energy. For example, rising petroleum prices tend to push-up the cost of animal feeds which 

in turn raises the cost of meats and derived products. However, given that the price of fuel at 

the pump is regulated, the full impact of the change in energy prices is not usually passed on 

to consumers. Nevertheless, it is anticipated that the most recent oil price increases will add 

a further BDS$33m per annum to the costs of the transportation industry. 

Domestic inflation is also subject to second tier or indirect effects. These second tier effects 

occur as rising consumer and producer energy prices result in a rise in the general price level 

for non-energy goods and services. These second tier effects produce contemporaneous as 

well as lagged effects on the remaining components of the RPI. However, in general most of 

these delayed effects tend to occur one year after the rise in oil prices due to the existence of 

Government price controls. 

Effects of Oil Prices on GDP and Other Macroeconomic Variables 

Simulations undertaken by the Central Bank of Barbados suggest that a US$20 per barrel rise 

in crude prices would reduce GDP in Barbados by about 2 percentage points or around $100 

million (US $50 million) and increase domestic inflation by around 0.5 percentage points. 

From the production side, rising oil prices lower value-added, especially for oil-intensive 

2

industries such as manufacturing and utilities, and to a lesser extent tourism, since it augments 

the costs of inputs used by firms. From the expenditure side, the rise in energy prices implies 

that consumers now have less to spend on other goods and services after paying more cash at 

the pump and on other energy related bills. 

Government's fiscal outturn is also likely to worsen somewhat, as the reduction in GDP leads 

to a slowdown in tax revenue growth, while spending on some public services could climb 

(for example, the Transport Board and the Barbados National Oil Terminal). Overall, the 

fiscal balance should worsen by between 1.0 - 1.5 percent of GDP. At the same time, the rise 

in the amount of foreign exchange required to purchase the same amount of imported energy 

leads to a deterioration in the external current account and a loss of foreign exchange reserves. 

The external current account is likely to deteriorate by between 1.5 and 2.5 percent of GDP, 

principally due to greater spending on fuels and reduced travel receipts. Overall liquidity in 

the banking system could rise as new credit could be negatively impacted due to the greater 

perceived risk on the part of the commercial banking industry. 

Industry-Specific Issues 

Manufacturing 

Fuel and raw materials are the two largest expenditure categories for most manufacturing 

establishments. For example, in the production of soft drinks most of the costs arise from 

sugar, water, syrup and electricity. Labour is principally employed for administration, 

inspection and transportation. Some larger manufacturing firms have been using their own 

generators for a while now which run on so-called 'dirty oil'. This technique was first 

employed by the Arawak Cement Company Ltd. to cut costs and is also used by Roberts. 

Obviously, generators involve a relatively large capital outlay, but it is an area being 

investigated by a number of companies, as the gains from using the generators could offset 

upfront costs. 

Tourism 

For most businesses in the tourism sector electricity and gas costs represent 15 percent of total 

expenditure compared to 25 percent for labour. Given this proportion, a rise in energy prices 

would definitely have an impact on the profitability of most hotels and restaurants. 


Conclusions 

Although there still remains a risk that the current high level of oil prices could be maintained 

or increased further, most analysts think that this is unlikely. The IMF, in their most recent 

World Economic Outlook are projecting that average crude prices in 2006 would be about 

US$61 per barrel compared to US$54 per barrel in 2005. The impact on Barbados, if prices 

instead rise by a further US$20 per barrel in 2006, would be negative, but not as severe as that 

experienced in the late 1970s and early 1980s. Energy consumption as a ratio to GDP has 

fallen since this period, as energy savings have occurred due to the transition from a 

manufacturing-based economy to one in which services are predominant and advances in 

technology has led to energy savings in the home. 

The initiatives announced by the Minister of Finance in his recent Economic Statement are 

well thought out and will be an important component in Barbados's strategy for minimising 

the effects of high oil prices on the Barbadian economy. 

4

Legacy Benefits of Hosting ICC 

Cricket World Cup 2007 

ICC Cricket World Cup (CWC) is the third largest international sporting event. In 2007, the 

event will take place across nine Caribbean territories and is estimated to be viewed by 2.2 

billion people around the world. 

It is no small feat for Barbados as the smallest country to ever host the Finals of the biggest 

cricket event in the world and it will take significant investment to meet the required 

international standards to cater to the thousands of visitors to our shores and to satisfy and 

exceed the expectations of the qualifying teams, match officials, sponsors and the event 

owners, the International Cricket Council (ICC). 

Our initial economic assessment made it quite clear from the outset that the investment will 

never be justified by the spend during those 50 to 60 days of cricket during March and April 

2007. But when the legacy benefit is taken into account, there is absolute consensus that 

Barbados and the region could easily see the returns on expenditure. 

The concept of legacy benefit is not an academic exercise and has become the determining 

factor for such fierce bidding among countries vying for the opportunity to host a world 

games. 

For cities like Barcelona and Sydney, research shows significant effect on tourism following 

their hosting of the Summer Olympics in 1992 and 2000 respectively: 

(a) Barcelona's tourism arrivals have risen by a cumulative 129% since the Olympics 

and 

(b) Sydney saw increases in its tourism receipts of 7% in the years following the 

Games 

The legacy benefits however do go far beyond tourism and actually touch a wide range of 

economic sectors. Again the Sydney Olympics is an excellent example of extracting great 

long-term benefits from hosting a major sporting event. The Games reportedly gave Australia 

a multi-billion dollar boost to infrastructure development, tourism and convention business, 

international media exposure, and new business estimated to be worth more than Aus$6.5bn 

in economic activity over a 12-year period. 

Tangibly the Games delivered substantial business and economic returns to Sydney, New 

South Wales and Australia, including: 


• $3 billion in business outcomes including $600m in new business investment 

• Injection of $6b in infrastructure developments in New South Wales 

• Injection of $1.2b worth of convention business for New South Wales between 

1993 and 2007 

• Greatly enhanced business profile 

• Greater expertise and confidence in tendering, both domestically and overseas on 

large scale projects 

Barcelona, another best practice model, reportedly achieved 50 years of infrastructure 

improvements in just 8 years in areas such as the airport, road, sewage, and 

telecommunications systems. 

In formulating Barbados' bid in early 2004, we determined that provided the legacy benefit is 

adequately derived, the return to Barbados lies in the region of 4 to 5 times the investment 

made. 

In keeping with Barbados' strategic approach to hosting the Cricket World Cup 2007, a 

Legacy Committee has been put in place, boasting some of Barbados' most distinguished 

minds drawn from a wide cross section of the society and representative of the many 

stakeholders involved. 

The Committee's principal role is to develop a Legacy Plan which includes identifying 

compelling long-term strategic Legacy Targets for CWC 2007; developing an action plan for 

each target and engaging the key drivers or stakeholders in the process to ensure that the 

targets, made up of identified measurable outcomes, are realized in the agreed time frame. 

Through a collaborative dynamic brainstorming process the following long-term strategic 

Targets have been selected: 

Excellence in Sports / Health - investing in building on Barbados' international reputation 

for cricket and sporting excellence and in developing existing and new sporting opportunities 

that can impact positively on health and can generate foreign exchange e.g. international 

motor racing. 

6

Event Barbados - establishing Barbados as the Events Capital of the Caribbean for a wide 

range of International Events whether in medicine, sports, entertainment, arts and culture, 

business and education etc. Barbados was recently announced as the venue for the 2006 PGA 

Golf World Cup. 

Community Tourism - bringing tourists directly into the local communities to experience the 

"real" Barbados and to support the development of community entrepreneurship. 

Export Barbados - radically changing from an import mindset to an outward looking, 

export-oriented culture and investing and supporting all export activities and identifying and 

fast-tracking the development of new ones. 

Think Barbados - creating a Think Tank to leverage on the knowledge and expertise of 

Barbadians worldwide to create a source of new, leading-edge ideas for economic and social 

development. 

Green Barbados - to engage all Barbadians in permanently transforming our Island into the 

clearest and most environmentally advanced country in the world. 

Quality of Life - development of a Quality of Life index, measuring the elements (e.g. crime 

rate, condition of roads, health care, education, etc.) that are most important to Barbadians and 

that make the Island attractive for all residents and investors. 

Through a process of community outreach and discussion the targets will be finalized and 

published early in 2006 and shared with all Barbadians so that there is national buy-in and 

momentum to support the work pre and post-CWC 2007. These targets will closely underpin 

the country's National Strategic Plan 2005-2025, entitled "Global Excellence, Barbadian 

Traditions" with a vision to be "a fully developed society that is prosperous, socially just and 

globally competitive". 

Long after the flurry of activity which 2007 promises, it is undoubtedly the legacy planning 

we have done that will become the crowning glory of this experience for generations. 

The most valuable and important but financially immeasurable legacy will be the social 

cohesion created by involving as many Barbadians as possible in developing and helping to 

execute the Legacy Plan as part of a strong collaborative National Team effort. 


Amalgamations Under the 

Value Added Tax (VAT) Regime 

In today's competitive world, companies are coming to the realization that amalgamation or 

mergers is fast becoming an option and for some, the only option, if they are to survive in 

today's business environment. The Companies Act of Barbados provides for two or more 

businesses to amalgamate and continue as one company (Section 206 of the Act). The 

continual existence of some businesses in Barbados depends to a great extent on mergers and 

these have been accomplished to the satisfaction of the entities involved, thereby preserving 

jobs and the continued existence of those businesses. 

However, adverse developments have taken place with respect to some recent amalgamations, 

which could have a negative impact on future amalgamations of businesses in Barbados. 

These developments pertain to the VAT treatment now being applied by the VAT office to the 

companies that are involved in mergers. Previously, such mergers were treated by the VAT 

office as the continuance of a business in accordance with the provisions of Section 206 of the 

Companies Act, and are consistent with the treatment for income tax purposes. Now it appears 

that they are being treated as a supply of goods or services by the merging entities under either 

section 24 (sale of assets), 25 (cessation of registration) or 26 (sale of a taxable activity) of the 

VAT Act. 

We are aware that, although every effort was made by the Barbadian authorities to introduce 

a relatively simple VAT regime, there will be occasions when grey areas will arise and, 

because of this, administrators of this tax system would be faced with difficult decisions. Such 

decisions are generally based on prudence and conservatism and therefore not generally in the 

favour of the tax payer. However, we view this particular diversion from the established tax 

treatment applied to amalgamations as an unnecessary burden to the restructuring efforts of 

the business sector. 

Implications of new method of addressing amalgamations 

Previously, on the amalgamation of two or more companies, the new company (Newco) 

would be registered for VAT and, although having a new VAT registration number, would 

submit its VAT returns on the basis of the information in the records of the companies that 

were amalgamated. Subsequent returns would then be submitted based on Newco's bimonthly 

financial data. Once Newco has been registered for VAT purposes, the VAT 

registrations of the predecessor companies were cancelled without any further VAT 

implications. 

The new VAT treatment regards the amalgamation as a supply for VAT purposes with Newco 

being the recipient of the supply and the disappearing companies being the suppliers. 

Apparently, the decision to assess the amalgamating companies for output tax is based on the 

assumption that a supply of goods takes place on an amalgamation. This VAT treatment for 

8

amalgamations will often result in a significant output tax liability for the companies involved 

in the amalgamation and an equally large input tax credit for Newco. This is particularly the 

case where a large stock of inventory is kept by the companies concerned and will create 

severe cash flow difficulties for these companies. We do believe that the VAT treatment with 

respect to amalgamations previously adopted by the VAT office was correct because there is 

no sale, transfer or other disposition of the assets of the companies involved in the merger. It 

should be noted also that these companies do not issue invoices in these transactions and that 

there is no exchange of goods. 

It is our view that this new position taken by the VAT authorities is not conducive to the 

advancement of business in Barbados. Furthermore it will not enhance Government's revenue 

intake since, in the case of the merger of registrants, it will simply be a case of companies 

having to borrow (and incur additional interest expense) to pay the output tax and another 

company recovering the tax as input tax. It should be noted that the general tendency is for 

companies involved in similar types of business to merge thereby minimizing government's 

VAT exposure. For example, registrants such as wholesalers and retailers merge with 

companies making similar taxable supplies. Similarly, non-registrants such as financial 

institutions and medical entities merge with entities in their respective groupings thus 

maintaining the status quo of providers of exempt supplies. In the unlikely event that a 

company making taxable supplies were to merge with one making exempt supplies 

government would still not be disadvantaged because of the apportionment provisions of 

section 48 (1) (b) (iii) of the VAT Act. 

This matter has now become one of grave concern for the business sector and requires an 

immediate resolution. 


Business Facilitation: 

Time to Put Words into Action 

In his presentation of the 2004 Economic and Financial Policy Statement, The Right 

Honourable Owen Arthur conceded that the bureaucratic processes within the public sector 

have impacted negatively on Barbados' business environment. Indeed, if it is the 

Government's vision for Barbados to be the premier high quality producer and exporter of 

financial and other services, then the current inefficiencies that exist within the public sector 

that hamper business in Barbados need to be addressed urgently. 

Historically, there have been numerous complaints from local business persons and foreign 

investors relating to the bureaucracy involved in dealing with certain Government 

departments. The complaints have ranged from issues surrounding the delays in obtaining 

clearances of imported goods from the Customs Department, to the lengthy procedures for 

granting work permits. Complaints have also been heard regarding the lengthy approval 

processes within the Town and Country Planning Department and Exchange Control 

Authority. Poor information flows within and between government bodies have also proved 

to be a major concern. 

Government has made some strides in dealing with these issues as evidenced by various 

projects undertaken by the Office of Public Sector Reform. For example, The Customs 

Automated Systems for Customs Data ("ASYCUDA") project has facilitated the 

computerization of the processes within the Customs Department to improve the efficiencies 

of that department. The SmartStream project has also allowed for the computerization of 

Government's financial procurement and payments processes. One area of concern, however, 

is the pace of change. 

For example, through the Enabling Environment for Private Sector Investment ("EEPSI") 

project, Government has sought to link the various Government departments via the internet 

to streamline and expedite flows of information to the benefit of the various Ministries and the 

general public alike. The proposed project start-up-date was the year 2000. However, the 

Economic Policy Statement for 2005 proposed that the first public sector services to come online 

would be the Land Tax Department, the Land Registry Department and the Registration 

Department. It is therefore expected that by September 2006, the general public would be 

able to perform on-line transactions with these Government departments. The Customs and 

Inland Revenue Departments would also be on-line by September 2007. 

While we eagerly anticipate the availability of such facilities, the length of time that it has 

taken to reach this stage is lamentable. We have talked for too long about the benefits without 

benefiting. It must be kept in mind that although Barbados has high quality service providers, 

investors will seek to locate where their business requirements can be met in a timely manner. 

Within the Caricom Single Market and Economy ("CSME") and the international market 

place, the competitiveness of local businesses will be severely hampered if business concerns 

are not dealt with expeditiously. 

10

The successful implementation of the above initiatives would assist in the creation of a culture 

of service excellence in the operations of the various Government agencies and enhance 

Barbados' reputation and ability to compete against leading international business centers 

such as the British Virgin Islands, the Cayman Islands and Bermuda. 

However, the success of the above initiatives will require far more than installing computers, 

providing Internet access and modern buildings to house public servants. Technical training 

in the specified areas within Government is essential if public servants are to have the 

confidence required to effectively carry out their duties using these tools. Training should not, 

therefore, be limited to the use of the new technology. 

Training also needs to be provided on a wider scale with respect to specific technical issues, 

such as the technical tax and other issues related to the international business sector. While it 

is recognized that such training is expensive when facilitated by well respected international 

organizations, the private sector may be of assistance in this regard. This training could be 

effected through the facilitation of seminars by the Barbados private sector in these specific 

areas. All agree that the cooperation between the private and public sector is a crucial element 

in the success of the public sector reform initiatives. It is now time to put theory into practice 

by endeavoring to cooperate in these vital areas, such as technical training, to the benefit of 

all concerned. 

Teeth also have to be given to those charged with the responsibility for facilitating the public 

sector reform. Government Departments should be made accountable for failure to 

implement the initiatives that have been determined to be beneficial for the business 

landscape in Barbados. No longer should the resistance to change be viewed as an acceptable 

stumbling block to our overall success. 

Efforts have been made to sensitize the Barbadian public to the importance of international 

business to the economy as well as the importance of delivering high quality services to 

customers. Meeting this challenge has been an upstream battle, not only for Government, but 

also for the private sector. We, too, need to take steps in facing this challenge. The private 

sector needs to institute standards of service excellence that are second to none. The sector 

also needs to lead by example, in a spirit of cooperation, if similar demands are to be made of 

Government. One means of so doing is through contributing to and participating in the 

National Initiative of Service Excellence ("NISE"). How are our businesses doing in this 

respect? 

It takes time to change the culture of the work force of an entire country. All stakeholders 

must, therefore, be continually reminded of the disadvantages associated with any failure to 

seize opportunities in this increasingly competitive environment in a timely fashion. With the 

CSME being implemented in February 2006 and the World Cup 2007 rapidly approaching, 

procrastination is a luxury that we can ill afford. The time to act is now. 


Ernst & Young Tax Leaders 

Ben L. Arrindell, Dip. Law 

Country Managing Partner and International Tax Partner 

Ben is the Country Managing Partner with responsibility for the Barbados and BVI offices 

Ernst & Young Caribbean. He is also an International Tax Partner and leader of the firm's 

International Business industry group. With over 20 years experience in the tax advisory 

field, he specialises in advising clients on Barbados tax issues as well as international tax 

matters. Ben joined the firm in October 1992 from the International Tax Group of Ernst & 

Young, London (UK). Prior to joining Ernst & Young, he worked with the International Tax 

Division of the UK Inland Revenue where his duties included negotiation of double taxation 

treaties and dealing with issues relating to tax harmonisation in the European Union. 

A frequent speaker on international taxation matters both in Barbados and overseas, Ben has 

also written articles on international tax issues for a number of international tax publications. 

Some of Ben's professional responsibilities and experiences include: 

• Member of the CARICOM Working Group on Fiscal Policy 

• Member of the Barbados Tax Review Committee 

• Member of the Joint Policy Working Group and Chairman of the group's Strategic 

Planning sub-committee 

• Member of the Board of Directors of the Barbados Private Sector Agency 

• Member of the United Nations Committee of Experts on International Cooperation in 

Tax Matters 

Maria Robinson, BBA, CA 

Partner, Tax Services 

Maria is a partner in our Tax Advisory Service Division. She has spent 18 years working in 

the professional services field, with over thirteen years of Tax experience. She holds 

significant experience providing advice on tax planning for regional and international 

corporate clients particularly in the financial and hospitality industries for clients based in 

Barbados and the OECS. 

Over the course of her career Maria has developed a keen appreciation for the tax Implications 

pertaining to mergers and acquisitions and reorganizations, at the local, regional and 

international levels. She is a Member of the Institute of Chartered Accountants of Barbados 

Institute of Chartered Accountants of Barbados (ICAB), a Member of the Tax Committee of 

the ICAB and a Member of the Institute of Chartered Accountants of Nova Scotia, Canada. 

12

Wade M. George, BA, LLM 


Wade is the regional service line leader for Tax & Corporate Services. He has overall 

responsibility for coordinating these services to clients throughout the Caribbean. He 

specialises in the area of corporate international tax advisory services and his experience 

includes a three and a half year assignment with Ernst & Young's International Tax Services 

Group in New York. Wade has considerable experience in developing and implementing tax 

minimisation planning structures in Jamaica, Trinidad & Tobago and Barbados, including 

mergers/acquisitions, green-field projects, and capital markets transactions. He has been 

involved in tax engagements for a variety of multinational clients of the firm. 

Wade is an Attorney-at-Law with a BA in Law and Sociology and a Masters of Law degree. 

He has spoken extensively on international tax matters in London, New York and Toronto. 

Nicole E. Lawrence, FCCA, CA 


Nicole is the partner in charge of operations within Ernst & Young's Tax department in 

Trinidad & Tobago. She has been involved in the assessment of the financial and tax 

implications of financing arrangements for companies in the oil and non-oil sector, due 

diligence reviews in the financial sector, and the preparation of business plans and feasibility 

studies using financial modelling techniques. 

Based in Trinidad, she is responsible for the management of the local compliance and 

advisory practice and the development of the international tax advisory services. Nicole has 

substantial experience in the development of financial products and the establishment of tax 

efficient corporate structures for local and international companies. 

Allison Peart 


Allison has over ten years of public accounting experience with Ernst & Young (Canada) and 

KPMG (Canada), serving a wide range of clients. Now based in Jamaica, she currently 

provides tax advice to clients there, including several subsidiaries of UK and US companies. 

Allison is a Canadian Chartered Accountant with several years of experience preparing and 

reviewing tax provisions for various clients. She has provided tax advice and implemented 

complex tax strategies for several European, US, Canadian and Caribbean firms and has 

experience in dealing with derivative products and structures for international financing and 

capital markets. 


Winston Gibbs, ATII 

Principal, Tax Services 

Winston joined Ernst & Young Barbados in 1978 after working with the Inland Revenue 

Service in the United Kingdom. He is an Associate of the Chartered Institute of Taxation in 

the UK. Winston has extensive experience on advising local and international clients on 

structures and tax planning. 

Simon Paler, BA (Hons), FCA, ATII, AMCT 

Principal, Tax Services 

Simon joined Ernst & Young in 2003. He has ten years tax experience having worked in the 

commerce section in the tax group of a large fashion retailer, an investment house and a 

multinational consulting group. Simon has wide experience of both cross-border and 

domestic transactions in Europe, Africa the Caribbean and Latin America utilising a range of 

tax mitigation techniques. 

Dominique Pepin, LLB, Dip 

Senior Manager 

Dominique joined Ernst &Young Caribbean in 2001 and holds a Masters degree in Taxation 

from the Universite de Sherbrooke in Canada. Before relocating to Barbados, she worked in 

a professional services firm as a Senior Tax Advisor in Canada. She has been trained in 

corporate reorganizations and has in-depth knowledge of the Canadian taxation system. 

Since joining Ernst & Young, Dominique has been involved in advising clients on the 

international tax aspects of structuring their investments in the Caribbean. 

Mark Shorey 

Senior Tax Manager 

Mark is a seasoned tax professional with over 40 years of tax experience. He worked with 

the Barbados Customs and Excise Department for over 25 years, followed by 15 years in a 

major professional services firm, where he was responsible for the delivery of VAT 

compliance, indirect tax and world trade services in Barbados and the Eastern Caribbean. 

Mark also specializes in customs classification and valuation and other customs advisory 

services. 

Gail Ifill, LLB 

Manager 

An Attorney-at-Law, Gail was recently appointed a Tax Manager based in the Barbados 

office of Ernst & Young Caribbean. She has extensive experience in International Business 

and in advising on tax matters in Barbados and the OECS. 

14

Ernst & Young Caribbean Leaders 

Executive Chairman 

Colin Soo Ping Chow 

Tel: (868) 628-1556 

colin.soo-ping-chow@tt.ey.com 

Country Managing 

Partners 

Barbados 

Ben L. Arrindell 

Tel: (246) 430-3800 

ben.arrindell@bb.ey.com 

Trinidad & Tobago 

Angella Persad 

Tel: (868) 622-6776 

angella.persad@tt.ey.com 

Jamaica 

Allison Peart 

(Leader of Operations) 

Tel: (876) 925-2501 

allison.peart@jm.ey.com 

Service Lines 

Assurance & Advisory 

Business Services 

Nicholas Gomez 

Service Line Leader 

Tel: (868) 628-5419 

nicholas.gomez@tt.ey.com 

Business Risk Services 

Arnold Niranjan 

Tel: (868) 628-3068 

arnold.niranjan@tt.ey.com 

Client Accounting Services 

Barry Davis 

Tel: (868) 622-0175 

barry.davis@tt.ey.com 

Tax Advisory & 

Corporate Services 

Wade George 


Tel: (868) 628-5185 

wade.george@tt.ey.com 

Nicole Lawrence 

Tel: (868) 628-1212 

nicole.lawrence@tt.ey.com 

Corporate Advisory Services 

William Hutchinson 


Tel: (246) 430 - 3876 

william.hutchinson@bb.ey.com 

Corporate Finance 

Angella Persad 

Tel: (868) 622-6776 

angella.persad@tt.ey.com 

Zack Nadur 

Tel: (246) 430-3877 

zack.nadur@bb.ey.com 

Industry Leaders 

Financial Services 

Colin Soo Ping Chow 

Tel: (868) 628-1556 

colin.soo-ping-chow@tt.ey.com 

International Business 

Ben L. Arrindell 

Tel: (246) 430-3800 

ben.arrindell@bb.ey.com 

Hospitality & Real Estate Services 

Andrew McConney 

Tel: (246) 430-3829 

andrew.mcconney@bb.ey.com 

Retail, Distribution & 

Manufacturing 

Nicholas Gomez 

Tel: (868) 628-5419 

nicholas.gomez@tt.ey.com 

Lisa Padmore 

Tel: (246) 430-3966 

lisa.padmore@bb.ey.com 

Energy 

Lily B. Young 

Tel: (868) 622-1736 

lily.b.young@tt.ey.com 


Contact Information 

Ernst & Young 

Barbados 

Worthing 

Christ Church, Barbados 

BB15008 

Tel: (246) 430-3900 

Fax: (246) 426-9551 

Jamaica 

8 Olivier Road 

Kingston 8, Jamaica 

Tel: (876) 925-2501 

Fax: (876) 755-0413 

Trinidad and Tobago 

5/7 Sweet Briar Road 

St. Clair, Trinidad 

Tel: (868) 628-1105 

Fax: (868) 622-0918 

64 Lewis Street 

San Fernando, Trinidad 

Tel: (868) 652-4375/6 

Fax: (868) 652-4377 

16

ERNST & YOUNG BARBADOS 

TAX SUBSCRIPTION SERVICES 

Update your reference library with the latest edition of 

Barbados' Tax Legislation. 

Current to September 2005, this edition provides important 

updates including: 

• Barbados Income Tax Act - The Income Tax Act 

Cap. 73, the Income Tax Regulations and the Orders. 

• Barbados Income Tax Treaties - which consists of 

various Income Tax Treaties which Barbados has 

concluded with regional and international countries to 

date, including: Botswana, Canada, CARICOM, China, Cuba 

and many others. 

• Value Added Tax Act - The Value Added Tax Act Cap. 87 

and Regulations. 

For each subscription year, the service entitles you to a copy of 

any amendments and any additional information or improvements 

we introduce, during the year. 

Each subscription fee is based on a calendar year. The annual fee 

for an individual subscription service to a local subscriber is 

BDS$287.50 (VAT inclusive) and for an overseas subscriber is 

US$150.00. A discount of 10% will be offered for the subscription 

to any 2 of these services and a 20% discount for the subscription 

of all 3 services. 

Ernst & Young Caribbean Attention: Kay Thomas 

P.O. Box 261 Tel: (246)430-3842 

Worthing Fax: (246)430-3879 

Christ Church Email: Kay.Thomas@bb.ey.com 

www.ey.com

E RNST & YOUNG 

www.ey.com 

© 2005 Ernst & Young 

All Rights Reserved. 

Ernst & Young is 

a registered trademark.

Focus on Barbados Budget 2005/2006

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