Antigua and Barbuda Economy Overview

Currency

East Caribbean Dollar (XCD)

Working hours

48 hours/week

Public/bank holidays

7 public holidays

Capital

St. John’s

Languages

English and Antiguan and Barbudan Creole 

Population

Approximately 98,000

Minimum hourly salary

EC$9.00

Tax year

1st Jan – 31st Dec

Date format

YYYY/MM/DD

Misclassification penalties

Significant penalties and retroactive tax liabilities if employees are misclassified as independent contractors.

Fun fact

Antigua and Barbuda are two of the most prosperous islands in the Caribbean due to their booming tourism industry.

The sovereign state of Antigua and Barbuda is made up of three islands with the largest, Antigua, accounting for 99% of the population. The remaining one percent are residents of Barbuda, a flat, coral island famed for its beaches and wildlife. Antigua and Barbuda has long been an attractive destination for investors owing to its picturesque beaches and favorable tax policies. 

This article explores the benefits and drawbacks of setting up a legal entity in Antigua and Barbuda and the legal steps to incorporating a business on the island.

Overview of Antigua and Barbuda's Economy

Antigua and Barbuda’s economy is driven by its tourism sector, which accounts for over half of the country’s GDP and 46% of the island’s employment. Golden beaches, coral reefs, and a variety of exotic marine life have historically drawn tourists to the island, with most visiting on cruises; Antigua and Barbuda’s tourism industry has recovered well following the COVID-19 pandemic with 176,665 stay-over tourists reported between January 2024 and June of the same year.
Sector Contribution to GDP Key Highlights
Services 67.8% Dominated by tourism, financial services, and government activities.
Industry 19.4% Encompasses manufacturing, construction, and utilities.
Agriculture 1.9% Focuses on domestic markets with products like fruits, vegetables, and livestock.

Following Prime Minister Gaston’s 2022 statement, ‘Setting the Stage for Economic Rejuvenation,’ in which he stressed the importance of reducing the island’s reliance on tourism and diversifying the economy, there has been a noticeable surge of economic activity in other emerging sectors. Aquaculture and ecotourism are growing industries with fishing contributing approximately 2.0% to GDP. Expanding the fishing sector in accordance with conservation efforts could help Antigua mitigate food scarcity concerns.

Additionally, due to its favorable tax policies, Antigua and Barbuda have become attractive offshore banking jurisdictions. As a member of the Commonwealth, banking activities are protected by strong regulatory frameworks. As of 2024, individuals are not taxed on their income, nor on their capital gains or inheritance.

Taxes

Employer tax: 6% – 9%

Social Security

5% 

Medical Insurance

1% – 1.5%

Employer tax: 4% – 6%

Social Security

Around 3%

Medical Insurance 

2 – 2.5%

Income Tax

There is no personal income tax in Antigua & Barbuda.

Business Regulation in Antigua and Barbuda

The Antigua and Barbuda Labor Code governs labor relations and working conditions on the island. All businesses must comply with the statutes outlined in the labor code when setting up a legal entity in Antigua and Barbuda.

The Antigua and Barbuda Intellectual Property and Commerce Office (ABIPCO) is responsible for overseeing business regulations on the island.  Businesses looking to incorporate a business in Antigua and Barbuda will need to submit the necessary documents to the ABIPCO, including the company name, names of directors, articles of incorporation, declaration of the company’s purpose, and the passports and IDs of directors/shareholders.

Once the above documents have been approved, the ABIPCO will issue a certificate of incorporation, officially establishing the business within Antigua and Barbuda.

Employers can choose to register their business online through the ABIPCO. The ABIPCO also offers a name search service and enables companies to calculate the cost of registering their business.

Companies will also be required to pay tax on their corporate income at a rate of 25% and contribute to social security on behalf of employees at a total rate of 14.5% for public sector employees and 15.5% for private sector employees.

What Are the Benefits of Doing Business in Antigua and Barbuda?

Antigua’s favorable tax policies, lucrative investment opportunities, and positive attitude toward FDI make it a prime location for businesses looking to expand their operations in the Caribbean.

The tax reforms implemented in 2016 removed taxes on personal income for both foreign and resident citizens. In addition to PIT, taxes on capital gains, inheritance, and wealth have also been eliminated. Under the 2016 law, employees are only required to pay a transfer tax for gifts. 

Although the government of Antigua and Barbuda still levies a 25% corporate income tax, businesses operating as an International Business Corporation (IBC) are exempt from paying this tax. An IBC is defined as a foreign-owned company with at least one shareholder and one director. Under Antigua and Barbuda law, corporate shares in the company may be owned completely by foreign nationals. IBCs enjoy a 50-year tax exemption.

The government of Antigua and Barbuda openly encourages and promotes FDI, and under national law, foreign investors are entitled to 100% of their investment. Although welcoming to all forms of foreign investment, the government has shown particular interest in investment in industries that generate jobs and significantly contribute to the island’s economy. For this reason, businesses involved in developing infrastructure, yachting, business process outsourcing, and marine services are being promoted by the government. 

In recent years, the ecotourism sector has seen a surge in economic activity. The Cades Reef has become a popular destination for water activities, including snorkeling and scuba diving, and the 11 Mile Beach found in Barbuda continues to draw foreign visitors. In 2018, Antigua opened the Wallings Nature Reserve, a community-managed national park located in the John Hughes Village. Offering visitors breathtaking views of Montserrat and Guadeloupe, the park is a must-see destination for nature lovers.

The success and growth of Antigua and Barbuda’s ecotourism industry, whilst heavily reliant on the health of its marine life and the upkeep of its nature reserves, offers foreign businesses multiple exciting and profitable investment opportunities.

What Are the Downsides of Doing Business in Antigua and Barbuda?

Due to its location, Antigua and Barbuda remains vulnerable to external shocks, including climate change. A decline in fish stocks and other marine life due to environmental changes could significantly impact the country’s ability to expand its aquaculture industry, leading to increased food insecurity.

Moreover, whilst tourism remains a huge driver of economic activity, visitors to the island are also contributing negatively to plastic pollution, making Antigua and Barbuda one of the top 30 global plastic polluters per capita. Additionally, persisting infrastructural challenges such as waste and water management continue to be a concern for the government and must be addressed if the island’s economy is to keep growing.

International Expansion into Antigua and Barbuda

Antigua and Barbuda Employer of Record (EOR)

An Antigua and Barbuda Employer of Record (EOR) service acts as the legal employer of your workforce in this Caribbean nation. The EOR provider is responsible for hiring local talent, administering benefits, managing payroll, and ensuring compliance with local and national laws. 

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Recruitment Agencies

Recruitment agencies in Antigua and Barbuda help businesses expand by connecting them with skilled local talent across various industries.

Remote People provides recruitment solutions that simplify hiring and ensure compliance with Antiguan and Barbudan labor laws.

For businesses looking to grow in Antigua and Barbuda, Remote People offers the expertise and resources needed to build a local workforce quickly and effectively, making it a practical solution for market expansion.

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Antigua and Barbuda Professional Employer Organization (PEO)

A Professional Employer Organization (PEO) is a third-party legal service that supports companies by shouldering their administrative duties, including processing payroll and ensuring tax compliance. A PEO acts as a co-employer, sharing the liability with the company and requires the company to have an established legal entity in Antigua and Barbuda when using their services.

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Subsidiary Incorporation

When setting up a company in Antigua and Barbuda, employers will need to choose a legal structure. Incorporating a subsidiary such as an LLC is a popular method due to the control and legal security it affords companies. A subsidiary is seen as an independent legal entity and is not required to operate under the authority of the parent company. As such, the parent company is not liable for the subsidiary. 

To register a subsidiary, businesses must submit the required documents to the ABIPCO and Internal Revenue Department (IRD). Companies working within certain sectors may also be required to obtain a business license and pay a registration fee. The cost of registering a subsidiary in Antigua and Barbuda can be calculated via the ABIPCO website.

Branch Registration

Alternatively, companies can choose to incorporate a branch office. A branch office is an extension of the parent company and must operate according to the parent company’s needs. As a result, the parent company will be liable for the actions of the branch including the hiring of employees and other administrative tasks.

The registration process for a branch office is very similar to that of a subsidiary. Companies will need to submit the necessary paperwork, complete a registration form, reserve a company name, and pay a registration fee. Upon registering the business, the company will be given an MBS registration number.

Business Opportunities in Antigua & Barbuda

Antigua and Barbuda, a twin-island nation in the Caribbean, presents a wealth of business opportunities for investors and entrepreneurs. With a strong focus on tourism, real estate, and financial services, the country’s economy is driven by government incentives, foreign direct investment (FDI), and investor-friendly policies such as the Citizenship by Investment Program (CIP). Additionally, growing sectors like agriculture, renewable energy, and technology are creating new avenues for sustainable business growth.

Strategically positioned in the Caribbean, Antigua and Barbuda offers access to both regional and international markets, making it an attractive location for global business ventures.

Business Opportunity Reason
Tourism & Hospitality Tourism accounts for nearly 60% of GDP, creating opportunities in eco-tourism, luxury resorts, yacht services, and adventure tourism.
Real Estate Development The Citizenship by Investment Program (CIP) has fueled demand for luxury residential and commercial projects.
Agriculture & Agribusiness Government incentives support sustainable farming, organic food production, and agritech investments to enhance local food security.
Renewable Energy Antigua and Barbuda is shifting toward sustainability, offering opportunities in solar and wind energy projects to reduce dependence on fossil fuels.
Information & Communication Technology (ICT) The government’s push for digital transformation and improved internet infrastructure makes it ideal for tech startups, software development, and IT services.

Antigua and Barbuda’s pro-business environment, tax incentives, and investment-friendly policies make it an ideal destination for entrepreneurs and foreign investors. The country’s strategic Caribbean location, stable political environment, and global business connectivity further enhance its appeal.

Additionally, Antigua and Barbuda has strong government-backed initiatives that encourage FDI in emerging sectors such as renewable energy, technology, and agriculture. With a growing economy and a focus on sustainable development, this island nation provides exceptional opportunities for businesses looking to expand in the Caribbean and beyond.

For those looking to capitalize on a growing economy while enjoying a high quality of life, Antigua and Barbuda is a prime destination for investment and business growth.

Expand to Antigua & Barbuda, with Remote People

Owing to its investment-friendly climate, abundance of wildlife, and growing tourism industry, Antigua and Barbuda offers many exciting opportunities for businesses looking to expand in North America.

As the country continues its efforts to address internal infrastructural challenges and cater to the needs of a growing visitor population, more investment is needed in the aquaculture and eco-tourism industries.

To learn more about expansion into Antigua & Barbuda, get in touch with Remote People’s local business expansion experts.