Bermuda must be ready for heightened competition from rival jurisdictions as the island’s first tax on corporate profits takes effect, said Christian Dunleavy, chairman of the Association of Bermuda International Companies.

Corporate income tax, which will apply at a rate of 15 per cent to Bermuda businesses that are part of multinational groups with annual revenue of €750 million (about $780 million) or more, will come into effect in January.

Speaking at Abic’s annual meeting, Mr Dunleavy emphasised the importance of guarding against complacency and ensuring the island remains an attractive business domicile.

“Bermuda is about to embark on the most significant change to our economic model in our history and the impact on Bermuda's competitiveness should not be underestimated,” Mr Dunleavy told the audience.

“Bermuda has long been about more than tax competition, and that includes areas that influence the cost of doing business in Bermuda, which include tax, but also regulation, quality and access to affordable healthcare, red tape and hiring practices.

“Capital and people are increasingly mobile, particularly in a world where 15 per cent is the new zero tax.

“Other financial centres, existing and aspiring, sense an opportunity to entice Bermuda's world-class companies and leaders to their shores.”

An investment promotion agency had been on island last week, touting the attractiveness of their country and incentives, he added.

“The ease and cost of doing business have been critical to Bermuda's success, but they are probably even more critical to our future success, punctuated by the Bermuda triangle of collaboration between industry, government and the BMA,” Mr Dunleavy said.

“High-tax, high-regulation countries can make themselves competitive in two ways.

“One is by imposing global taxes and increased regulation on smaller, more business-friendly countries to reduce their competitive edge.

“The other is to make themselves more competitive. Both of these dynamics are happening today with renewed vigour.

“Bermuda, as a small financial centre, can only do the latter, protect and continually enhance our own competitiveness. Our international businesses are not afraid of competition, nor should Bermuda be.

“Responding to these global pressures by focusing on the areas within our control to enhance our competitiveness and attractiveness is crucial — lowering our cost structure, eliminating bureaucracy, maintaining appropriate regulation, and making sure Bermuda is a great place to live and work.”

Mr Dunleavy, who is also group president at Aspen Insurance Holdings and chief executive at Aspen Bermuda Ltd, said Abic supported the Government’s goal of increasing the working population to combat Bermuda’s demographic challenges.

He added that Abic’s member companies had a strong track record of hiring, educating and developing Bermudians, alongside the global talent they attract, a trend illustrated by the increasing number of Bermudians in senior roles.

“We know from our data that one IB job creates 1.33 local jobs,” Mr Dunleavy said.

“Career opportunities will only continue over the coming years as this growing pipeline of Bermudians in IB moves up the ranks.

“Bermudians and overseas talent are not in competition with each other. This is not a zero-sum game. We mutually benefit from each other’s shared experiences and expertise.”

The Abic chairman added that international business and Bermudian interests were remarkably aligned, particularly in the desire to see a healthy tourism industry as a strong second pillar of a diverse Bermudian economy.

“IB, like Bermudians and Bermudian businesses, benefits from increasing airlift and hotel capacity,” Mr Dunleavy said.

“The current restricted hotel capacity and airlift is directly impacting the cost of doing business in Bermuda. It’s increasingly difficult to secure reasonably priced flights and hotel rooms for our staff, customers, visiting colleagues and board meetings.

“IB is a major contributor to business tourism. We welcome the reopening of the Fairmont Southampton in 2026, hopefully the redevelopment of Elbow Beach and other hotel investment.

“We also support efforts to increase airlift, including BermudAir's recently announced expansion of routes.”

Mr Dunleavy expressed Abic’s support for the Government’s aim to increase residential housing in the City of Hamilton, helping to create a vibrant city centre, while supporting retail businesses and nightlife.

“A residential city is also critical to Government’s population goal, while easing pressure on our limited and delicate open space in the parishes,” Mr Dunleavy said.

“It can create new economic opportunities for local companies and lower the cost of housing for all of us, providing a new rung on the housing ladder for first-time homeowners and young Bermudians at a more affordable price point.

“So, 2025 marks a significant moment in Bermuda’s economic development. Our continued success and growth will depend on all of us working together on a shared vision and effective execution of that.

“Bermuda’s best days can be ahead, and Abic and its members look forward to continuing to play our role in Bermuda’s success story.”

At the AGM, Mr Dunleavy also thanked Patrick Tannock, who retired this year after nine years as Abic chairman and a 40-year insurance career, for his “unwavering commitment, time, talent and passion that have greatly benefited Abic and all stakeholders”.

Mr Tannock will remain on the Abic board of directors.

• For the full statement from the Association of Bermuda International Companies, see Related Media

Download PDF File

ABIC 2024 AGM.pdf