Aruba offers an attractive business environment with its territorial tax system and competitive corporate income tax rates. Businesses operating in Aruba should be aware of the corporate income tax rates ranging from 25% to 35%, as well as other taxes such as profit tax for sole proprietorships and partnerships, social security and wage taxes, property tax, turnover tax (BBO), and any specific taxes applicable to their industry. To ensure compliance and obtain accurate information, it is advisable to consult with a tax professional or refer to the official website of the Aruban Tax Authority for the most recent tax regulations and requirements.
Corporate Income Tax:
Aruba operates a territorial tax system, meaning that only income generated within the country is subject to taxation. As of the knowledge cutoff date in September 2021, the corporate income tax rate in Aruba is progressive, with rates ranging from 25% to 35%. The applicable rate depends on the annual taxable income of the business.
Types of Business Taxes in Aruba:
- Corporate Income Tax: Corporate income tax is levied on the profits generated by businesses in Aruba. The tax rates range from 25% to 35% based on the annual taxable income of the company. Businesses are required to file an annual tax return and pay the applicable tax amount.
- General Sales Tax (GST): Aruba does not impose a Value Added Tax (VAT) or Goods and Services Tax (GST) on goods and services. However, specific excise taxes may apply to certain goods such as alcoholic beverages, tobacco, and motor vehicles.
- Profit Tax for Sole Proprietorships and Partnerships: Sole proprietorships and partnerships in Aruba are subject to profit tax, which is similar to corporate income tax but with different tax rates. The profit tax rates for these types of businesses range from 20% to 40% based on the annual taxable income.
- Social Security and Wage Taxes: Employers in Aruba are responsible for withholding and paying social security and wage taxes on behalf of their employees. These taxes fund social security benefits such as healthcare, pensions, and unemployment benefits. The rates for social security and wage taxes vary depending on the employee's gross salary.
- Property Tax: Property tax is applicable to real estate properties owned in Aruba. The tax is calculated based on the assessed value of the property and varies depending on the property type and location.
- Turnover Tax (BBO): Turnover tax, also known as BBO (Belasting op Bedrijfsomzetten), is a tax imposed on the turnover of certain goods and services. The tax rates range from 1.5% to 6% depending on the type of goods or services.
Aruban Tax Authority Website:
For accurate and up-to-date information on business taxes in Aruba, it is advisable to visit the official website of the Aruban Tax Authority. The website provides comprehensive details, forms, guidelines, and contact information for tax-related inquiries.
Aruban Tax Authority Website: Official Aruban Tax Authority Website
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