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HomeREGIONALWE’VE BEEN TREATED UNJUSTLY, SAYS INVEST BARBADOS

WE’VE BEEN TREATED UNJUSTLY, SAYS INVEST BARBADOS

The economic development agency responsible for attracting international investment to Barbados, is expressing horror at the “unjust” and “disproportionate” listing of Barbados as a non-cooperative jurisdiction for tax purposes by the European Union.

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Invest Barbados, in a media release today, said Barbados was being penalised for being ‘partially compliant’ in three of the ten essential elements of the Organisation Economic Cooperation and Development’s (OECD’s) standards.

Following the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes classification of Barbados as “partially compliant at the end of its review in March this year, the EU in May placed the country on its “blacklist” of countries considered non-cooperative jurisdictions for tax purposes.

This, despite Barbados implementing several changes to its tax exchange framework by the end of last year. The period for the sanction was between July 2015 and June 2018.

In its release on Tuesday, Invest Barbados said the three areas that the country was being penalised for were availability of ownership and identity information, accounting information, and the quality and timeliness of its responses to requests from overseas tax authorities for tax information on Barbados resident taxpayers.

“It is important to note that the Global Forum rated Barbados as compliant in the remaining seven of its essential elements,” it said.

Describing the EU’s action as reprehensible, Invest Barbados said since assuming office in May of 2019, the Mia Mottley administration has amended over 14 pieces of legislation, ensured that request for exchange of information from other jurisdictions were appropriately answered in accordance with the law, conducted audits and reviews of the Corporate and Trust Service Providers and has ensured that up-to-date and relevant beneficial ownership information is properly maintained and accessible by the authorities.

It said the EU has therefore ignored all the work that has been done by the Government to correct the deficiencies in the 2015 to 2018 period.

“Furthermore, the Report released by the EU today insinuates in its report that Barbados still has work to do, relative to its legal framework.

“This is untrue, when by its own written admission, the EU has recognized the tremendous work and results that this Government has achieved . . .

“Simply put, the country is being punished today with the imposition of enhanced due diligence measures on our financial sector to see if we will do what we say we will do,” it added.

Officials said in “normal times” the action could be regarded as bullying at worst and at best, actions to preserve the competitiveness of the EU.

“However, in the middle of this Global  Pandemic of COVID-19 where Barbados’ GDP is likely to  contract by more than
15 per cent of GDP, it is simply  an unconscionable act and a crime against the people of  two of the smallest and most vulnerable nations of the world from one of the largest block of countries globally.

Anguilla is also on the EU list of non-cooperative jurisdictions for tax purposes.

Invest Barbados said the listing at this time makes the action “the poster-child of disproportionate and unfair behaviour”.

“We must not forget that lack of proportionality is a breach of the European Convention of Human Rights.

“Further, there is a failure on the part of the EU to hold to account countries whose tax systems can easily be described as discriminatory, like Delaware in the USA, and Switzerland and Monaco in Europe.

“In addition, independent studies have shown that a number of EU countries are failing to enforce beneficial ownership information requirements as competently as Barbados and other Caribbean countries,” it said.

It added that: “Barbados has strenuously objected to the decision made by the EU and has written to both the President of the European Council and President of the Council of the European Union, Chancellor Angela Merkel of Germany, expressing its grave attrition over the action taken by the EU”. (MM)

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