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Dominica: Budget proposes flat individual income tax rate, extended VAT relief

Budget proposals include changes to individual income taxation and indirect tax measures.

august 26, 2026

The government of Dominica on August 4, 2026, presented its fiscal year 2026/2027 budget, proposing a number of tax reforms affecting individuals and businesses.

The budget proposals include:

  • A single 10% individual (personal) income tax rate
  • Taxation of residents and nonresidents only on income earned in Dominica beginning January 1, 2027
  • Tax deductions for qualifying commercial rental buildings
  • Tax deductions for approved business disaster funds
  • Reintroduction of the employment tax rebate beginning October 1, 2026
  • Extension of VAT and import-duty relief on essential goods through September 30, 2026

Beginning October 1, 2026, excise tax and VAT on imports would be calculated solely on the cost, insurance, and freight (CIF) value, ending the practice of applying tax to other customs taxes and charges.


For more information, contact a KPMG tax professional in the Eastern Caribbean:

Marianne Greenidge | mariannegreenidge@kpmg.bb

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