Government yesterday moved to validate the two per cent fee Barbadians have been paying on credit card and other foreign exchange transactions imposed by the Democratic Labour Party administration three years ago.
The Foreign Exchange Control (Amendment) Bill 2020, which was passed in the House of Assembly, provides for the imposition of the two per cent fee on foreign exchange transactions and validates its collection, backdating this section to July 17, 2017, when former Minister of Finance Chris Sinckler announced the fee’s introduction in his Budgetary Proposals.
The regulation related to the credit card fee has been backdated to September 2017.
Leading off debate on the amendment yesterday, Minister in the Ministry of Finance Ryan Straughn said the Mia Amor Mottley administration was working to bring back economic stability to the island and to build up its foreign reserves.
Though he indicated Government was reticent about going ahead with the fee, to which it had shown some objection at the time it was initially imposed, Straughn said the current economic state of Barbados necessitated the continuation.
Among other things, the amendment saw the insertion of new definitions from what was contained in the original legislation. For example, it stated in part that the foreign exchange fee “is payable by a person who obtains foreign currency in Barbados, in any form, from a foreign currency provider; or who, whether in Barbados or outside Barbados, purchases foreign currency or purchases goods or services in foreign currency with a credit card, a debit card or a prepaid travel card denominated in Barbados dollars and issued in Barbados”.
In the case of businesses, there is a $100 000 cap on the fee per transaction.
Straughn restated Barbados’ commitment to maintaining a fixed exchange rate, saying this was in accordance with the support given by the Social Partnership immediately after the Barbados Labour Party Government took office, for the parity of the Barbados dollar to remain.
He praised Government for its “prudent” management of Barbados’ economic affairs in the bid to restore the country’s finances to a healthy position, noting that the foreign reserves had climbed back to $1.5 billion as of Monday.
Straughn said Government intended to build a framework in which Barbadians would engage in endeavours that would earn foreign exchange for the island. (GC)
