Despite being blacklisted by the European Union (EU), Deputy Prime Minister and Minister of Finance Peter Turnquest emphasized that business in the country “is being conducted in a fair, transparent and competitive manner”.
“As a country we reject the label that we are a tax haven. And I commend the financial industry for its own initiatives to adapt, realising a long time ago that we cannot rely on out-dated notions of being low tax or no tax to differentiate ourselves,” he said.
The Bahamas was added to the EU blacklist of tax havens Tuesday March 13. At the time, Turnquest, called the move “regrettable”.
Other jurisdictions on the list of Non-Co-operative Jurisdictions for tax purposes include: America Samoa, Guam, Namibia, Paulau, Samoa, Trinidad and Tobago, U.S. Virgin Islands and St. Kitts and Nevis.
“It is important to emphasise that this is not about The Bahamas’ willingness or ability to meet the obligations set by the EU Code of Conduct Group (COCG), governing business taxation,” Turnquest said.
“The Bahamas is completely on schedule to meet COCG’s December 2018 deadline for full compliance, having already taken concrete steps. The Government has been communicating in good faith with the EU on a consistent basis. It has been absolutely transparent and absolutely engaged. In this instance, there was a regrettable misunderstanding in Brussels about the way communications are handled at the technical level versus the ministerial level in The Bahamas, and a misunderstanding over a fine technical point in the use of contractual language.”
He added that “active discussions were underway”, therefore it was “disappointing that the COCG made its recommendation in spite of this ongoing dialogue.”
“Given the seriousness of the matter, I personally led/joined a senior delegation along with the Minister of Financial Services, Trade & Industry and Immigration the Hon. Brent Symonette, to have a face to face intervention with EU Officials in Brussels,” he explained.
“We left with verbal and written communications stating The Bahamas has no outstanding correspondences or deliverables that should prevent it from being delisted in the near future. In the words of the representative of the Chair of COCG, The Bahamas has done everything it needed to do and now it is the EU’s time to act. The Bahamas expects the EU Economic and Financial Affairs Council (ECOFIN) to make this a priority when it meets.”
He said as an important takeaway, the government will act earnestly to strengthen its diplomatic presence in Brussels, as direct diplomatic relations are just as vital to advancing the interests of the financial sector as engagement and coordination at the technical level.