Companies Reminded to Pay Minimum Business Tax

Tax Administration Jamaica (TAJ) is reminding owners and operators of businesses that they are required by law to pay the Minimum Business Tax (MBT) of $60,000 per annum, on their operations.

The reminder comes as the TAJ moves to significantly reduce the high level of non-compliance among the 62,000 companies on file.

Speaking at special taxation forum held on Thursday (August 28) at the Private Sector Organization of Jamaica’s (PSOJ) offices on Hope Road, St. Andrew, TAJ Technical Specialist, Monica Walker, said based on the agency’s records, only about 6,000 of the entities file annual statutory returns.

She stressed that the payment, which is to be made twice per year in June and September, must be made by all categories of businesses.

“So… once your company is registered under the Companies Act, the Building Societies Act, Friendly Societies, Industrial, or Providence Societies Act, which cover almost all companies in Jamaica, it means you are required to pay the Minimum Business Tax,” she stated.

Mrs. Walker noted that several non-compliant companies have been taking steps to address their situation by cooperating with the TAJ.

“So far, we have seen that the companies… are either de-registering… or they are doing what they ought to do (by making payments), and we are grateful for that,” she said

Director of the Ministry’s Taxation Policy Division, Ian Scarlett, advised that where a company’s operations are dormant or trading has ceased, the operators are required to undertake the de-registration process at the Companies Office of Jamaica.

“That’s the responsible thing to do, because the TAJ would not be aware that you are not trading and therefore, (if your operations) appear in their data, the tax is going to be levied on you,” he informed.

The MBT, which came into effect on April 1, 2014, forms part of the Government’s initiative to widen the country’s overall tax base. The tax of $60,000 for the year is due in two instalments on June 15 and September 15.

Thursday’s forum was jointly hosted by the Finance and Planning Ministry and the Small Business Association of Jamaica (SBAJ).