|
|
|
[Home Page] |
|||||
|
|||||
Advertisers Dupuch & Turnquest & Co.
|
 |
Hawksbill Creek Agreement helped begin Freeport
The Hawksbill Creek Agreement created what was to become The Bahamas’ second largest city, Freeport/Lucaya, on Aug. 5, 1955. Freeport was designed to be exactly that, a “free port” that would encourage foreign investors to come to Grand Bahama Island through a variety of tax exemptions.
This agreement is a contract between the government of the Bahamas and the Grand Bahama Port Authority Limited (commonly referred to as simply the Port Authority), a private company founded by Virginian financier Wallace Groves.
Under the Hawksbill Creek Agreement, the government of the Bahamas granted the first 50,000 of Crown land in the center of Grand Bahama Island to the Port Authority and gave the Port Authority the exclusive right to develop it. In return, the Port Authority was required to dredge a deepwater harbor; construct an airport, hospitals and schools and provide other services and amenities. Later, the Port Authority acquired additional land from the Crown and from private sources, giving it a total of 150,000 acres, or 233 square miles for development.
As an incentive for doing this work, the government of The Bahamas granted the Port Authority the right to grant business licenses. Later, the Port Authority was given permission to license casinos and to develop tourism within the Freeport area.
The cornerstone of the Hawksbill Creek Agreement is that residents or licensees in the Port Area are free from personal income taxes, corporate profit tax, capital gains tax, death taxes or property taxes until 2015.
While the rest of The Bahamas is also free of these taxes, the Hawksbill Creek Agreement guarantees that residents and/or licensees would have these exemptions until the 2015 date. Thus, even if the tax regime in the Bahamas would change because of to the Free Trade Agreement of the Americas, the Hawksbill Creek Agreement would provide a special exemption clause to maintain this tax-free status until 2015.
The Agreement also provided that residents and licensees also be free from excise taxes, stamp duties and most customs duties until 2054. This means that any building materials, machinery or other equipment used by businesses licensed by the Grand Bahama Port Authority will be exempt from duties. Companies that carry on business in the Port Area will also be exempt from the Bahamian business license fee until August 2054.
|
|
Table of Contents The Bahamas: An established tourism and tax-free financial services center experiences a renaissance |
|
