Ground rent incentive
The government of the Island Territory of Curaçao is the owner of several parcels with a proper zoning for hotel development. With the aim to stimulate the establishment of new hotels on Curaçao, favorable terms can be applied in granting the long lease rights on these parcels. These terms are subject to approval by the Island Council of the Territory of Curaçao and are evaluated on a case by case basis.

Gliding scale for ground rent
Under normal circumstances pertaining to the issue of leasehold land belonging to the Island Territory of Curaçao, the ground rent is set at 6% of the current value of the land. Under the gliding scale procedure the ground rent is reduced and amounts to 10% of the total ground rent for the first year. Subsequently the ground rent gradually increases with 10% per year until year ten at which time it reaches full value.

The table below displays the increase in percentages of the gliding scale:

Term of the leasehold
The leasehold term applied for large investments is under normal circumstances set at 40 years. As part of the ground rent incentive the term may be extended to 60 or 99 years upon request of the lessee.

Average ground rent calculation
In selected cases, especially regarding projects requiring very large parcels, it is possible to apply a ground rent calculation whereby the proportion of a parcel destined for public purposes (like for example parking and landscaping) is calculated at a very reduced rate. Using this calculation method results in very favorable average ground rent prices.

General conditions
In case an interested party desires to become eligible for the ground rent incentive it has to take the following into consideration:

1. the target group for which the ground rent incentives were created includes local and international investors expanding the number of hotel rooms for visitors to Curaçao; 
2. a hotel is understood to mean an enterprise dedicated to the operation of hotels or other establishments providing accommodation and recreation, aiming to promote visit of tourists to Curaçao, and which can be expected to broaden economic base of Curaçao; 
3.  the applicant must be a corporation limited by shares (NV) incorporated on Curaçao; 
4.  the lessee must prove through a financing agreement with a bank that the financing is secured for the entire project; 
5.  in case of non-compliance with the rules and stipulations of the incentive or in case of bankruptcy of the lessee within the period for which the incentives have been granted, the Island Government of Curaçao may impose sanctions. The Island Government of Curaçao can revoke the incentive with retroactive effect as of the date of granting such.

The application procedure
Interested parties must direct a written request for the exemption to the Executive Council of the Island Territory of Curaçao, through Bureau Domeinbeheer, Klipstraat 19, Curaçao, Netherlands Antilles. For additional information please contact Bureau Domeinbeheer (Public Lands Management Bureau) at telephone 599-9-434-1200, fax 599-9-434-1266 or via e-mail domein@curinfo.an.

Building permit incentive
Under normal circumstances, the investor in a tourism project should pay levies to acquire the building permit amounting to a percentage of the estimated building value. Dienst Ruimtelijke Ordening en Volkshuisvesting (DROV) is the body imposing the building levies and issuing building permits. It is possible to apply for an incentive on the building permit levies in dealing with tourism projects.

The application procedure
For further information please contact Dienst Ruimtelijke Ontwikkeling en Volkshuisvesting (Department of Urban and Regional Development, Planning and Housing), Plaza Hoyer, Curaçao, Netherlands Antilles telephone 599-9-461-2679, fax 599-9-461-2697 or via e-mail drov.info@curacao-gov.an.

Tax Holiday
Special tax facilities are available for newly incorporated companies for the operation of hotels and other establishments providing accommodation and recreation aiming to promote visit of tourists to Curaçao and which can be expected to broaden the economic base of the Netherlands Antilles. These tax incentives are granted by the Government of the Netherlands Antilles under the so called Tax Holiday regime. The Island Government of Curaçao has an advising role in the process of granting the tax holiday.

Investment Incentives
The following investment incentives apply for new hotel construction: 

• exemption of import duties on materials and goods for construction and initial equipment, including all equipment necessary to enable the new industry to commence business; 
• exemption of land tax; 
• exemption of occupancy tax; 
• exemption of profit tax with the understanding that a tariff of at least 2 %, including island surcharges, is levied on the realized profit; 
• exemption of personal income tax on income earned from dividends and other distributions of export profits, provided that the profit is distributed two years after termination of the financial year in which the profit is realized.

For existing hotels undergoing renovation an exemption of import duties and/or economic levies on goods for construction is applied for a period of two years.

General conditions
In case a hotel on Curaçao desires to become eligible for the tax holiday as stipulated in the ordinances pertaining to new hotel construction, it has to take the following into consideration: 

1. the investment for the construction and first furnishings of the company must at least amount to ANG 1,000,000; 
2. construction and first furnishings as referred to under point 1 also include expansion of the hotel room capacity; 
3. the tax holiday will be granted by decree of the Netherlands Antilles government; 
4. the investment amount as referred to under point 1 needs to be applied within 2 year of the date of the decree; 
5. the tax holiday is valid for a minimum period of 5 years and a maximum period of 11 years.

In case a hotel on Curaçao desires to become eligible for the tax holiday as stipulated in the ordinances pertaining to the renovation of hotels, it has to take the following into consideration:

1. the minimum investment must amount to ANG 300.000,-. 
2. the company should aim to promote visitors to Curaçao.

The application procedure
Applications for above mentioned facilities should be directed to the Directie der Belastingen, Regentesselaan z/n, telephone 599-9-734-2000. For additional information please contact the Dienst Economische Zaken (Department of Economic Affairs), Molenplein z/n, telephone 599-9-462-1444, fax 599-9-462-7590 or e-mail at dezbob@hotmail.com

Exemption from room tax
On Curaçao, each hotel guest is charged with a room tax of 7% on the price per room per night. Under normal circumstances, the hotel operator must pay this room tax to the Island Tax Collector of the Island Territory of Curaçao on a monthly basis. As an incentive to attract international hotel chains to Curaçao and to encourage the necessary investment by hotel owners to achieve this, exemption of the obligation to pay the collected room tax to the Island Tax Collector can be granted to the hotel.

General conditions
In case a hotel owner desires to become eligible for the room tax exemption it has to take the following into consideration:

1. The incentive is only applicable to hotel owners that attract new international hotel chains to establish on the island; 
2. The hotel owner must belong to a company limited by shares, incorporated on Curaçao; 
3. The hotel owner is considered to have attracted an international hotel chain as long as the hotel is operated using the name of the international hotel chain, which should be clearly visible on the hotel;
4. The international hotel chain must consist of at least 15 hotels, operating in 5 countries with a minimum of 5,000 hotel rooms; 
5. The period of the exemption is five years maximum and must cover consecutive years, unless the total amount of room tax payable during these five years exceeds the total qualifying investment. In this case, the incentive applies up to the qualifying investment amount; 
6. Investments made up to two years before and five years after the takeover date by the international hotel chain qualify for exemption; 
7. The starting date of the exemption period will be determined by the Executive Council of the Island Territory of Curaçao; 
8. In case of non-compliance with the rules and stipulations of the incentive program within the five-year period for which the incentives have been granted, or if essential data has been withheld, the Executive Council of the Island Territory of Curaçao may impose sanctions. The exemption can be revoked with retroactive effect as of the date of the granting of the exemption.

Qualifying investment
Only investment made to upgrade or expand the hotel and/or to procure the furnishing of a hotel or other expenses and that are necessary to attract the international chain, qualify for exemption of room tax. The following requirements are set for investments to be eligible for exemption: 

1. investments that have a direct relation with acquiring the international hotel chain 
2. investments to physically improve and change the building and facilities on the site, including infrastructure, landscaping and beach 
3. investments in furniture, fixture and equipment excluding vehicles and vessels 
4. investments as a consequences of the termination of existing contractual obligations as far as necessary to be able to carry out the contract with the international hotel chain 
5. investments related to other exceptional costs, excluding travel and accommodation expenses, costs related to studies and research undertaken, including consultants, and other costs that can be considered as customary to recruit the management of a hotel

Required information
The following information should be submitted together with the application for an exemption of room tax:

1. a Product Improvement Plan, indicating the activities to be undertaken to improve the hotel in order to attract the international hotel chain; 
2. a time schedule, indicating when investments will be or have been carried out; 
3. proof that the international hotel chain agrees with the Product Improvement Plan and the time schedule; 
4. a cost estimate for the implementation of the Product Improvement Plan, to be made by an independent organization; 
5. proof that the hotel owner agrees with the cost estimate; 
6. eventual other investments necessary to attract the international hotel chain, including a time schedule; 
7. an estimate of the room revenues, including service charges and other costs, for a period of five years as of the take over date of the operations by the international hotel chain and as approved by the international hotel chain; 
8. a copy of the management or franchise agreement with the international hotel chain.

The application procedure
Interested hotel owners must direct a written request for the exemption to the Executive Council of the Island Territory of Curaçao, Concordiatraat 24, Curaçao, Netherlands Antilles. For additional information please contact Curaçao Tourist Board, Pietermaai 19, Curaçao Netherlands Antilles or at telephone 599-9-4348223, fax 599-9-4615017 or e-mail ctdbcur@attglobal.net.