In a significant economic move, the Saint Lucian Parliament has officially sanctioned a nationwide Value Added Tax (VAT) exemption day scheduled for December 22, 2025. This legislative action fulfills Prime Minister Philip J. Pierre’s campaign pledge made prior to the December 1 general elections, formally enacted during Parliament’s first post-election session through an amendment to the VAT Act.
The approved legislation empowers the Inland Revenue Department to implement necessary adjustments, zero-rating most consumer goods purchased on the designated date from authorized businesses. Prime Minister Pierre explicitly clarified the broad scope of eligible items during parliamentary proceedings, stating, ‘So stoves, televisions, clothes, carpet, food, Christmas trees – everything that you buy locally… you pay no VAT.’
However, the exemption excludes several specific categories including motor vehicles, petroleum products (gasoline, LPG, diesel), firearms and ammunition, tobacco products, alcoholic beverages, professional services, legal fees, restaurant supplies, rent payments, lottery tickets, phone cards, internet and cable services, tourism-sector sales, and all imported goods and services.
Business participation remains voluntary, requiring formal application submission to the Inland Revenue Department. Acting Comptroller Felicia Ellie emphasized that only approved applicants may legally offer VAT-free sales, ensuring compliance with national tax legislation. The government plans to publish comprehensive lists of both eligible products and participating retailers ahead of the shopping event.
This initiative provides consumers with an effective 12.5% discount on most purchases, though the total tax saving exceeds this amount as purchases remain subject to Saint Lucia’s additional 2.5% health and security levy. The current VAT rate represents a reduction from the original 15% implemented when the tax was introduced in 2012.
