Grant Thornton looked into the future and came up with a Fiscal Plan 2023 impact assessment which includes their analysis in regard to the restaurant sector of Aruba.
The intention behind this assessment was to provide an insight into the potential impact the Fiscal Plan 2023, can have on the business in Aruba, and specifically for this assessment the restaurant sector.
For this assessment they have used actual figures which have been adapted a bit for anonymity and applicability of the Fiscal Plan 2023.
The information gathered from the impact assessment of this restaurant is meant to give a general idea of the financial impact on all restaurants on Aruba.
In the assessment they reviewed the tariff increase of the turnover tax BBO/BAZV/BAVP, the changes in the profit tax and the changes in the personal income tax.
The project was handled by: Melina Rangel/Lyxienne Bareno
Changes relevant to the restaurant sector, Fiscal Plan 2023 :
The total rate of the BBO/BAZV/BAVP will be increased to 7%.
The BBO rate will be increased from 1.5% to 2.5%.
No BBO at import has been announced.
The profit tax rate will be reduced from 25% to 22%.
The depreciation on real estate will be limited.
The self-administered pension (in Dutch: ‘pensioen in eigen beheer’) will be abolished.
The minimum wage for directors of a company in which they hold shares will be deemed at 50% of the total revenue up to a maximum of Afl. 100.000 per year.
Introduction of a tax on excessive loans of directors which are also shareholders. This can be in the form of a tax on dividend.
After analysis, the Fiscal Plan 2023 changes affect the restaurant sector as follows:
The BBO/BAZV/BAVP burden for a restaurant will increase with 17%.
The total expenses will increase with 1% (amounting to a five-figure difference) due to the increase of the BBO/BAZV rate. GT has not taken into account any inflation as a result of these measures.
The taxable profit will increase with 68% (amounting to a six-figure difference) The higher taxable profit is a result of the abolishment of the self-administered pension and the depreciation correction.
The profit tax burden of a restaurant will increase with 48% (amounting to a five-figure difference)
The shareholder(s) burden may vary, depending on their wages and their loans.
My conclusion: It isn’t easy to own a restaurant.
