VAT on Online Orders in The Bahamas, Explained

VAT is the one charge that applies to nearly every package you bring into The Bahamas, including items that are duty free. It's also the charge people find most confusing, because it isn't worked out on the price of the item alone. Here's how it works.

The rates

• 10% is the standard rate of VAT in The Bahamas, in force since January 1, 2022.
• 5% is a reduced rate that has applied since September 1, 2025 to a list of health and hygiene goods, including diapers and baby wipes, sanitary pads and tampons, adult disposable underwear, blood pressure monitors, blood glucose meters, insulin and syringes, first-aid kits, bandages, and many medicines.

The duty rates pages mark which items pay 5%, and our shipping calculator applies the right rate when you choose the item.

What VAT is charged on

Customs charges VAT on the landed cost of your goods, not just the price. The landed cost is:

• the price you paid for the item,
• plus the customs duty,
• plus the customs processing fee,
• plus any environmental levy,
• plus freight, insurance and other charges to get it here.

So a duty-free laptop still pays VAT, and a TV with high duty pays VAT on the duty as well as on the TV. That's why a high duty rate costs you twice.

VAT on our services

Mr. Ship It's own services, freight and package protection, are services supplied in The Bahamas, so they carry 10% VAT too. Your bill shows this separately from the VAT Customs charges on your goods.

A worked example

A $300 item with 20% duty, such as clothing, with $30 in freight:

Charge	How it is worked out	Amount
Duty	$300 × 20%	$60.00
Processing fee	1% of $300, $10 minimum	$10.00
Landed cost	$300 + $60 + $10 + $30	$400.00
Customs VAT	10% of $400	$40.00

Of that $40 in VAT, $30 is on the item, $6 is on the duty, $1 is on the processing fee and $3 is on the freight. A duty-free item of the same price would pay VAT on $340 instead: $34.

Can I avoid paying VAT?

Not on goods you import as a consumer: there's no minimum value below which online orders are VAT free, and the $500 travel exemption only covers goods you carry back with you. Businesses registered for VAT should ask their accountant whether the VAT paid at import counts towards their VAT return.

Keeping the total down

• Check the duty rate before you buy. Lower duty means lower VAT too.
• Choose the right item category. Products on the 5% list pay half the VAT.
• Mind the box size. Freight is part of the landed cost, so a smaller box saves freight and the VAT on it.

For the full picture of duty, fees and clearance, read our Bahamas customs guide.