The Tax Holiday for Land Development in Curacao: Opportunities for Real Estate Developers

Since June 2021, the government of Curacao has implemented a temporarily relaxed policy offering tax incentives for investments in land development. This initiative, known as the "tax holiday Curacao," is designed to stimulate investment in the construction sector, particularly in projects focused on tourism and social housing.

What Does the Tax Holiday Curacao Involve?

The tax holiday provides significant fiscal advantages to companies investing in land development projects. These benefits include:

• A reduced profit tax rate of 3% for a period of 6 to 11 years, depending on the size of the investment

• Exemption from property tax for 5 to 10 years

• Exemption from import duties on certain materials and goods for 2 to 5 years

• Exemption from income tax on dividends and other profit distributions to shareholders, provided the distribution takes place within two years after the end of the fiscal year in which the profit was earned

Relaxation of Requirements

Originally, the policy required that at least 80% of the developed real estate be made available to non-residents in order to qualify for the tax holiday. Due to practical challenges and the impact of the COVID-19 pandemic, this condition was relaxed. As of 2020, the requirement has been reduced to 20%, meaning that projects can now qualify if just one-fifth of the properties are sold or rented to non-residents.

This relaxation was extended in December 2024 and remains in effect until December 31, 2025, giving developers more flexibility in planning and executing their projects.

Eligibility Criteria

To qualify for the tax holiday, projects must meet specific conditions:

• A minimum investment of ANG 5 million, excluding the purchase price of the land

• The project must aim to promote tourism or provide social housing

• At least 20% of the developed properties must be made available to non-residents

Conclusion

The relaxed tax holiday scheme offers developers and investors attractive tax benefits and greater flexibility to tailor their projects to local market demands. For more information on the available opportunities, interested parties are encouraged to contact tax advisor Joost Houtsma of Guardhouse powered by Financieringsgilde at joost@guardhouse-curacao.com.