The introduction exchange rate margin levy of the Central Bank of Aruba (“CBA”) is directly related to the execution of the tasks of the CBA in connection with the promotion of the monetary stability and functioning as the central foreign currency exchange bank of Aruba. The levy will be charged to the net income earned by the local commercial banks of Aruba as a result of foreign currency exchange transactions.
Exchange rate margin levy
According to the State Ordinance exchange rate margin levy the CBA will charge commercial banks with an exchange rate margin levy equivalent to 3/8% (0.375%) on all sales of foreign currency to the public. According to the law the percentage of 3/8 will be reduced with an exchange rate margin levy equivalent to 1/8% (0.125%) on all purchases of foreign currency from the public. The amount due (therefore the percentage of 3/8 on sales reduced with the percentage of 1/8 on purchases) is calculated on a monthly basis. The tax due must be submitted by the commercial bank to the CBA within 15 days after the end of the month.
To cover for the charges of this additional levy, the commercial banks have decided to charge an additional fee to their clients on all foreign currency purchases.
Companies established in the Free Zone of Aruba are not exempted from the new fee introduced by the commercial banks.
Source: PWC Aruba – The new CBA exchange rate margin levy
For more information visit www.cbaruba.org or download the documents below:
http://www.cbaruba.org/cba/readBlob.do?id=3424 (Dutch)
http://www.cbaruba.org/cba/readBlob.do?id=3366 (English)