Bahamas VAT deadline faces push to extend to 60 days

The dispute matters because real estate transactions in The Bahamas are still heavily paper-based and often involve banks, lenders, lawyers and buyers in different jurisdictions. Attorneys told a briefing that conveyances and supporting documents frequently take longer than 21 days to move through due diligence and funding steps, while one lawyer said her firm had been waiting six months for VAT invoices on 33 transactions.

For mortgage borrowers, that timing mismatch can turn a routine closing delay into a direct cost. Banks in The Bahamas typically take two to three weeks, and sometimes longer, to review a file before releasing funds, which means many buyers could run past the new deadline even when they are acting in good faith.

Komolafe said the policy risks making home ownership more expensive at a time when fewer Bahamians qualify for mortgages. She also argued buyers should not be penalized for administrative delays inside the tax authority, pointing to the absence of a digital registry and saying any promise to deduct Inland Revenue review time from the 21-day clock should be written into law, not handled case by case.

Department officials acknowledged there could be legitimate issues for international buyers and said the agency does not write the law. But attorneys questioned whether the new interest charge is needed at all, noting a separate 10% late fee already applies to conveyances not stamped or paid within 180 days.

The broader economic issue is housing affordability. If the levy is enforced as written, it could raise closing costs and slow transactions in a market already constrained by financing hurdles and title-processing friction. That makes the fight over the deadline more than a tax dispute: it is a test of whether the government wants faster compliance or a real estate market that can still function smoothly.

The next pressure point is Oct. 5, when enforcement is set to begin unless lawmakers or regulators move to extend the deadline or formalize exemptions for delays beyond buyers’ control.