UDP GOVERNMENT REPORT CARD JUMPS 10% TO 16%. PRO-BUSINESS AND INVESTMENT TAX CUTS IN BELIZE.

UDP GOVERNMENT REPORT CARD GAINS 10 POINTS - NEW SCORE 16% APPROVAL RATING

The UDP government gets awarded a whopping 10% on their report card rating. The new score is 16% The reason for the big jump was a demonstrated change in modus operendi regarding taxation. Particularly for financial and telecommunications services.

The economy badly needs stimulating. The recent announcement by the end of this year is that TWO ITEMS on taxation have been announced.

---the RESULTING CHANGES ARE CONSIDERED PRO BUSINESS AND FINANCE, FOR INVESTMENT PURPOSES.

1) ELIMINATING THE 15% TAX ON DIVIDENDS FOR COMPANIES.

2) THE TAX ON INTERNET SERVICES HAS BEEN CUT FROM 24.5% TO 1.5%.
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Posted: 16/12/2011 - 11:22 AM
Author: Adele O. Trapp - aotrapp@amandala.com.bz

Shareholders of Belize Telemedia Limited (BTL) approved on Thursday night the payment of 32 cents per share in dividends—just over $15 million—at the company’s 5th Annual General Meeting, held at the Princess Hotel in Belize City.

With the stamp of approval from shareholders, chairman Net Vasquez said that the company is again paying out half its profits to shareholders, while retaining the remainder to grow the company.

It means that the Government of Belize (which owns about 70%) will earn about $13 million in dividends, the Social Security Board (which owns 20%) about $1 million, the Central Bank (which owns 8%) under half-a-million, and the remaining shareholders, including 1,000 new shareholders, just over half-a-million dollars.

New shareholders, who purchase shares after the 2011 share offering, will be paid for the last four months of the financial year, December to March, even if their shares were purchased later than December. Vasquez told shareholders that the board decided to be generous and permit the payment from the time the first block of government shares were divested—that is, when the Social Security Board purchased $50 million worth of shares from the Government.

Last year, BTL paid out 50% of profits to shareholders, declaring 23 cents per share in 2010, up from 19 cents the prior year (2009).

The Government of Belize had earned nearly $11 million in dividends then, while roughly $600,000 was shared among the remaining shareholders.

BTL is this year reporting a 38% increase of $10 million in profits, from $21.3 million to $31.3 million.

The increase in profits for 2010-2011 is mostly due to a change in the tax rate for internet services, which gave the company a boost in operating income of nearly $14 million.

Vasquez said that the Government has reduced the tax rate on high speed internet to 1.75%, scaling it back from 24.5% to 19% and then to this nominal rate of tax.

He told shareholders that the Government has also eliminated taxes on dividends, which means that when shareholders get their dividend checks next week, they will for the first time in over a decade, not have the 15% deduction from their earnings in dividends.

The tax benefits also apply to the Ashcroft company, SpeedNet.