No Removal of Value Added Tax (VAT) from Heathcare Services

December 24th, 2015 (Nassau, Bahamas) – In response to a statement appearing in yesterday’s newspaper, the Ministry of Finance advises the public that no proposals have been put forward by the Ministry of Finance to remove the VAT from health care services.

The Ministry is aware that various stakeholders including Bahamas Insurance Association have questioned whether healthcare should be exempt from VAT. The Ministry however has explained to stakeholders that adjustments to the VAT system cannot be made independently of technical advice on how the government can offset any reduction in revenue sources, or advice on how the government can continue to maintain the current low VAT rate. The current system of minimum exemptions also allows health care providers to recover the VAT paid on goods and services used in their operations in a fashion that is fully transparent to consumers.

The benefits from VAT have already increased the government’s financial flexibility, adding the capacity to finance the initial proposed NHI benefits and some healthcare systems strengthening.

The Ministry of Finance is working closely with the NHI secretariat to evaluate proposals that would preserve the financial viability of the scheme as the NHI benefits are increased over time.

For further information, visit the Department of Inland Revenue’s new website at, email or call (242) 461-8050.