SA Construction Limited currently operates in Trinidad. The company is considering setting up another location in either Barbados or Jamaica. The Projected Income Statement for 2023 is as follows: USD Income

Sales 90,000 Interest Income 2,500 Dividend Income 6,000 Other Income (exempt) 2,000

Expenses

Depreciation 20,000 Interest Expenses (1) 7,000 Repairs & Maintenance 1,500 Legal & professional fees (2) 8,000 Salaries 30,000 Bad debts (3) 3,000 Other Expenses (4) 20,000 Taxation 2,250

Notes 1. All Interest was paid. There was no accrued interest at year end. 2. Professional fees consist of: Audit and accountancy fees $3,600 Legal fees recollection of bad debts $2,000 Cost of setting up business in the selected location $900 Architects fee for designing a warehouse that has not yet been constructed $1,500 3. The Bad Debts expense represents a debt that was outstanding for 270 days. 4. Other expenses include $1,000 for expenses paid on behalf of another company owned by SA Construction Limited, $600 for fines and penalties, $1,500 for course fees of the directors, and expenses relating to exempt income. 5. Capital Allowances of $15,000 was projected. 6. Estimated Tax of $700 was paid to the relevant Tax Authority. 7. Assume Exchange Rates: J$ 150: 1 USD and TT$ 6 :1 USD Required i. From a corporate tax perspective, in which country would it be more tax beneficial to operate? Ignore Employment Tax Credits, Corporate tax Credits available in Jamaica and other similar credits in Barbados)

ii. Explain two main reasons why expenses may not be deductible for income tax/corporation tax purposes.

iii. What other factors, if any, should be considered when setting up operations in these countries?