Companies like MailPac should benefit from the Government’s recent decision to increase custom duty thresholds at ports and airports.

Speaking on Taking Stock with Kalilah Reynolds, Chief Investment Officer at JMMB Group, Peter Thompson, said the increase, if granted would remove all of the restrictions customers currently face when importing items.

Finance Minister Dr Nigel Clarke announced recently that the government intends to repeal and replace Jamaica’s Customs Act. One of the major updates will be to double the duty-free allowance for imported goods at ports and personal items at airports.

Currently, Jamaicans can import items worth up to US$50 duty-free. If the item costs more than that, customers are charged duties on the full value of the item. 

According to the Finance Minister, beginning April 1, 2024, that threshold will increase to US$100. 

Additionally, the tax threshold for personal and household items at airports will increase from US$500 to US$1,000.  

Thompson noted that this will likely incentivize customers to purchase more online, which will in turn benefit companies such as MailPac.

“It should impact their earnings positively. Anything that encourages people to do more online shopping will bode well for companies like MailPac,” he said.

On the flip side, he noted that brick-and-mortar stores may take a hit as customers may find it more affordable to purchase items from overseas rather than wait.

There is also concern about how the move will impact the Government’s revenues.

According to the 2023 budget, the Government estimates it will earn $63 billion in revenue from customs tax.

.Finance Minister, Dr Nigel Clarke is expected to give more details surrounding the changes once the government tables the bill to replace the Act in Parliament in 2024.