NASSAU, BAHAMAS — A top banker yesterday contended the determination on the best tax structure for this nation is not simply a matter of sovereignty but survival in the global geopolitical arena.
G7 finance ministers this past weekend agreed to a landmark deal to battle tax avoidance having agreed in principle that multinational companies pay a minimum tax rate of at least 15 percent in each country where they operate.
Following that revelation, the government reasserted that it is this nation’s ‘sovereign right’ to determine the tax structure best suited for the ongoing development of the country.
Gowon Bowe, the Fidelity Bank (Bahamas) chief executive told Eyewitness News:“What we should be acknowledging is that is obviously a global initiative being pushed by major countries. Instead of being seen as combatant, we should be looking to being a part of informed dialogue.
“This is where it becomes critical for The Bahamas to have its global representatives in the right place at the right time to participate in these types of discussions even as auxiliary observers because we are naturally not members of the G7 and also participate in forums and discussion groups. I think The Bahamas needs to practically look at this.”
Bowe continued: “I think it’s not a matter of sovereignty but it is a matter of survival in a global geopolitical arena. We have the sovereign right to make decisions but we don’t have an economic right to prosperity in the absence of those discussions resulting in sanctions from countries we have to do business with.
“I think we have to be more mature and forward-thinking so that we understand the discussion taking place and ensure that we are actually well briefed on the merits and demerits of what is being discussed. We must ensure that we are informed on the actual plans of implementation and well briefed on what it means for those entities that reside in our jurisdiction .”
Bowe noted that while the minimum tax rate discussion has been going on for some time, with the United States now “joining the fray”, the speed and tone of those discussions has changed.
“The US joining the fray is what is changing the speed and the tone because before you had one of, if not the largest, superpower which at best was lukewarm and at worst opposed to the issue under the previous administration.
“However, with a Democratic administration which has built into their economic and political philosophy socialism and the right of the state to tax its citizens in order to provide benefits to them, it has now given support to the discussion going on in the EU environment.”
“We are small players and while we pack a mighty punch we need to be strategic in understanding where the discussions are going, push our initiatives locally and take advantage,” said Bowe.
He noted that The Bahamas is not as economically independent as some may think as it relies on the G7 countries most importantly for foreign currency.
“The Bahamas cannot afford to be excluded from the global arena. Only Cuba has survived and we’re not Cuba,” said Bowe.
