Barbados Implements Car Rental Levy

The Government of Barbados introduced a new car rental levy for vehicle rentals that took effect in mid-October 2025. This new daily charge replaced the previous visitor driving permit system.

There is now a modest per-day levy added to rental costs. It is capped at a total amount for standard short-term rentals and applied by both commercial agencies and private vehicle owners.

Funds collected through this levy go directly to organizations tasked with protecting coastal and marine environments, linking your rental payment to local conservation efforts. The change also streamlines the rental process for visitors by removing the separate permit step while directing revenue towards long-term environmental projects.

Essential Obligations for Rental Companies and Operators

The government has implemented key requirements for car rental companies and operators. They must:

• Collect the daily car rental levy (ranges from BBD 5.00 to BBD 35.00) from every renter at the time of contract, for both residents and visitors.
• Keep a record of each rental contract with required fields such as renter name, nationality, driver’s licence expiry, vehicle registration, rental dates, and other contract details.
• Show the levy as a separate line item on all customer receipts and invoices.
• Submit monthly levy returns and remit payment through the TAMIS system by the 15th day of the month following the reporting period (for example, report November rentals and pay by December 15).
• Use the Car Rental Levy Template to input information and upload it with the TAMIS return.

Official Policy Document

The Barbados Revenue Authority published a Policy Note which outlines the requirements for rental companies and private operators. Rental companies and private operators should:

Consult the formal policy note that explains the levy framework and the end of visitor driving permit requirements.
Use the policy note to confirm compliance steps, definitions, applicable rates, caps, and any transitional arrangements that affect your operations.
Keep a copy of the policy note readily available for staff training and for resolving customer or audit queries.

Filing Spreadsheet and Upload Options

The Car Rental Levy Template must be used to enter rental information. Companies and private operators should:

• Use the prescribed Excel template to record each rental agreement’s required fields; do not alter the template structure.
• Save the completed spreadsheet and upload it with your monthly TAMIS return.
• Retain copies of uploaded files and proof of payment to support reconciliations and potential audits.

Frequently Asked Questions

How are charges calculated on a rental car reservation?

Car rental rates are seasonal and are determined by the type of vehicle. Most rental companies rent vehicles daily.

What extra charges commonly appear on a Barbados car rental invoice?

Standard car rental invoices commonly list base rental, taxes, and several possible additional charges you should expect or review:

• Airport concession or facility charges if you pick up at an airport.
• Vehicle delivery to residences, villas or hotels.
• Optional product charges (insurance, loss damage waiver, supplemental liability, GPS, child seats, extended roadside assistance).
• Fuel charges, underfill or refueling service fees if you return with less fuel.
• Young driver, additional driver, or late-return penalties when applicable.
• Out of hours costs (i.e. before 7:00 am or after 6:00 pm)
• Storage racks on the top of the vehicle
• Smoking and valet charges

Inspect each line on the final receipt and compare it to the reservation confirmation to confirm optional items and mandatory surcharges.

What are the driver requirements for renting vehicles in Barbados?

Driver requirements vary by company. But many companies require that drivers must be 21 or older and 80 and younger. Drivers must have held a valid driver’s license for at least 3 years. Drivers over the age of 70, should produce a doctor’s certificate which confirms they are fit to drive in Barbados.

What tax or levy applies to car hires in Barbados and how often does the Government implement changes?

Barbados imposes taxes and duties on car rentals that can include a percentage-based tax and sector-specific levies administered at the national level. The government periodically updates rates or introduces new levies. The most recent adjustment took effect in October 2025.

Where can I rent a car on my trip to Barbados?

There are several car rental companies in Barbados. Some of them are:

• Courtesy Rent a Car
• Hertz Rental Car
• Drive Barbados Rent a Car
• Stoute’s Car Rentals
• Venture Car Rentals
• Top Car Rentals

Visiting to drivers can expect a small daily charge included in the car rental price, capped per rental. The new approach simplifies vehicle rental procedures for visitors. The Barbados government collects these revenues and allocates them to coastal and marine conservation organizations.

Source: Car Rental Levy Guide and Resources (Barbados Revenue Authority)

Photo: Tom Jur via Unsplash