Jamaica has unveiled its most ambitious fiscal shake-up in a decade, introducing a new sugar tax and a raft of levy increases to fund post-hurricane reconstruction and plug a growing gap in the national budget.
Jamaica’s Finance Minister Fayval Williams unveiled the 2026-27 national Budget on 12 February 2026. The latest budget is driven largely by the economic fallout from Hurricane Melissa, which caused damage exceeding USD 8.8 billion.
The government has outlined a JMD 1.441 trillion spending plan against projected revenues of JMD 1.338 trillion. To close that gap, a series of new and revised taxes have been introduced.
New tax on sweetened drinks and hikes on existing levies
As part of new tax measures, Jamaica’s government has introduced a first-of-its-kind Special Consumption Tax (SCT) on non-alcoholic sweetened beverages (NASBs), set at JMD 0.02 per millilitre. This covers all beverages — carbonated or not, imported or locally made — containing added sugars or artificial sweeteners. In practical terms, a 300ml bottle will cost JMD 6 more, a 600ml bottle JMD 12 more, and a 2-litre bottle JMD 40 more.
Alongside this, the SCT on cigarettes rises from JMD 17 to JMD 20 per stick, and the SCT on alcoholic beverages climbs from JMD 1,230 to JMD 1,400 per litre of pure alcohol — both effective 1 May 2026.
Modernising the broader tax system
The General Consumption Tax (GCT) will now apply to digital services and intangibles consumed in Jamaica but supplied from abroad, following the internationally recognised destination principle.
This is expected to generate JMD 300 million in the final quarter of FY 2026-27, growing to JMD 4.2 billion once fully operational in FY 2027-28.
The reduced 10% GCT rate on tourism activities will be phased up to the standard 15% from 1 April 2027, allowing the industry time to adjust. Once in effect, this is forecast to yield JMD 11.4 billion annually.
Civil servants’ motor vehicle concessions are also being modified — the GCT exemption is removed while the customs duty concession and SCT exemption remain, generating an estimated JMD 1.3 billion from 1 May 2026.
Finally, the Environmental Protection Levy (EPL) will increase from 0.5% to 0.8%, and the calculation base for locally manufactured goods will expand from 75% to 100% of sales value, also effective 1 May 2026. This is expected to raise JMD 3.639 billion.
