Traditional Shop Versus Online Shop: Turnover Tax A visit to the local post office will give one a glimpse of the growing popularity of internet shopping, which has also affected Curaçao. This trend has also become apparent to many retail businesses on the island, which have seen their customer base decline during the past years, partly due to this. TEXT BY: ANGELA RASIMAN, MEIJBURG & CO CARIBBEAN
That this trend will continue for at least a little while proves the enormous growth of Amazon’s net revenue from its online stores segment, from USD 91.43 billion in 2016 to USD 108.35 billion in 2017. In an attempt to boost sales local retail businesses may decide to engage in the online shopping business, therewith creating the possibility to expand their customer base both domestically as well as across the borders. How the switch from a traditional to an online retail store will affect
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CURAÇAO BUSINESS
the turnover tax obligations of the business will be briefly highlighted in this article. For the businesses to be successful, researching the market and careful planning will be essential. Research has showed that the factors which motivate most consumers to buy online instead of going to a shop are flexibility of time and cost savings. The elements which hold the potential for the business to optimize costs and to be successful are the physical
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store, warehouse locations and logistics. How that is, may become clear when the tax implications are explained. It is important to understand in advance what the turnover tax implications may be, since it enables proper managing of the business’s tax obligations such as the timely and correct collection, reporting and remittance of turnover tax, thus preventing penalties, fees or closed shut downs for non-compliance. It also gives entrepreneurs the opportunity to plan and manage the business accordingly. From the consumer’s point of view turnover taxes add to the overall cost of a good. First of all one needs to understand that Curaçao turnover tax implies the taxation of: • the delivery of goods and the rendering of services within the territory of Curaçao with the exclusion of the economic zone, by entrepreneurs within the course of their business.
