Formed in January of 2006, AREBB was an institution long overdue and quickly started addressing issues that were detrimental to the real estate industry in Belize. Chief among those issues was the Government of Belize’s implementation of the GST (General Sales Tax) in June of 2006. Through aggressive lobbying, AREBB managed to reduce stamp duty (transfer tax) on property sales to 5% across the board for all purchasers, whereas before, stamp duty was 15% of the selling price for non-Belizeans. The government went further and offered to charge stamp duty only on purchases above $20,000 BZD or on the portion of the selling price above that amount.
AREBB is now actively engaged with the Government of Belize in formulating the legal framework for operating as real estate brokers and salespeople in Belize. This legislation is known as the Real Estate Bill currently in the process of becoming the Real Estate Act.
The Founding of the Association of Real Estate Brokers of Belize (AREBB)
In the early part of 2006, the private sector was gearing up for the Government of Belize’s enactment of the GST Act (General Sales Tax). GST sought to apply a 10% general sales tax to almost all industries in the private sector. Seeing how this would adversely affect the real estate industry and jeopardize millions of dollars and years of effort invested by both Belizean and foreign investors, the founding members of AREBB, Madeleine Lomont, and Stewart Krohn decided to act and aggressively lobby the government to rethink its strategy in taxing real estate development and sales.
Lomont and Krohn called on the largest and more established brokers and developers in the country to unite and form the body representative of the major stakeholders in the real estate industry in Belize. The industry heard the call and recognized the need for a representative body. Membership grew rapidly and reached more than 70 members in just a few months.
In June 2006, after lobbying the General Sales Tax Department and the Ministry of Finance, Lomont and Krohn accomplished AREBB’s first major achievement. They had successfully lobbied the Government of Belize to reduce stamp duty from 15% of selling price for Non-Belizeans, to 5% of selling price for all purchasers, regardless of nationality. The government went further and offered to charge stamp duty only on purchases above $20,000 BZD or on the portion of the selling price above that amount. Though Government would not retract its aim to collect GST on sales of newly developed real estate, the efforts of the association’s early members resulted in developers facing what could have been a 26.5% tax burden on selling price, to one that was vastly reduced to 16.5%. Foreign investors could now purchase and own property at a reduced cost paying more than 10% less on selling price for stamp duty (transfer tax).