“
T
and Global Radar and wherever gaps are identified, we need to
provide public progress reports on what we have done to close
these gaps.
he Region has expended
significant resources
3. The Region must undertake a targeted and focused rebranding
marketing campaign to change this tax haven perception.
(financial and otherwise) at
4. Regional governments must act together to ensure that the Region is represented in key decision-making fora which can impact the growth and development of our economies.
country and industry level
to comply with international
standards on tax transparency...
”
Moreover, this prejudicial labelling positions the region as being ‘high
risk’ and can have serious impact on trade and cross-border capital
flows coupled with untold reputational damage. For example, the region has been facing de-risking of the financial services sector and this
perception of the Caribbean as a tax haven has caused correspondent
banks to ascribe a high risk rating to regional banks. The loss of correspondent banking relationships in turn has had ripple effects on the
transmission of remittances and transfer of funds necessary for other
economic activities.
Six Suggested Steps: While there are individual countries which
are working on specific areas regarding AML/CTF and tax transparency, the majority of countries are highly compliant. To reverse negative perceptions I wish to propose the following:
1. We must establish a mechanism for monitoring and enforcement of the relevant laws.
2. We must publish the results of our National Risk Assessments in
key international media such as Bloomberg, Wall street Journal,
i OECD Global Forum on Tax Transparency and Exchange of Information for
Tax Purposes. (2015). Tax Transparency. Paris: OECD.
ii Tax Justice Network. (2016). Financial Stability Index. Retrieved fro m Tax
Justice Network: http://www.taxjustice.net/
iii Fichtner, J. (2015). The Offshore Intensity Ratio. Identifying the strongest
magnets for foreign capital. City Political Economy research Center Working
Paper.
iv OECD. (1988). Harmful Tax Competition, An emerging Global Issue.
OECD.
v Bureau for International Narcotics and Law Enforcement Affairs . (2016).
International Narcotics Control and Strategy Report: Money Laundering and
Financial Crimes. United States Department of State.
vi International Consortium of Investigative Journalists. (2016). New Leak
Exposes Bahamas Secrets and the Panama Papers. Retrieved from ICIJ.com:
https://www.icij.org/
vii US Department of Treasury. (2016, 10 19). Resource Center. Retrieved
from US Department of Treasury: https://www.treasury.gov/resourcecenter/tax-policy/treaties/Pages/FATCA.aspx
viii OECD. (2016, 10 21). Automatic Exchange Portal. Retrieved from OECD:
https://www.oecd.org/tax/automatic-exchange/crs-implementation-andassistance/crs-by-jurisdiction/
5. Caribbean Governments must address issues affecting our
Region in a unified manner and not adopt an individualistic approach, thus strengthening the voice of the Region.
6. To ensure efficient and effective compliance, CARICOM governments must work towards the harmonisation of key legislation and regulation.
The Region has expended significant resources (financial and otherwise) at country and industry level to comply with international standards on tax transparency and it can therefore be considered unfair
to label the Caribbean as a tax haven. Notwithstanding, there are
some areas in need of attention. Correspondent banking issues, rising
compliance costs, low growth and the reputational damage caused by
unfairly branding Caribbean countries as Tax Havens are proving to
be a significant challenge. It is very apparent that we cannot face this
individually. We must collaborate and cooperate to implement the
necessary changes to protect our reputation.
Joanna Charles is the Chairperson
of the Caribbean Association of Banks,
(758) 452 2877, [email protected], www.cab-inc.com
ix OECD. (2016). Exchange of information of Request. Retrieved from
OECD: https://www.oecd.org/tax/transparency/exchange-of-informationon-request/ratings/
x OECD. (2015, June 19). OECD Global Forum on Transparency and exchange
of Information for Tax Purposes. Retrieved from OECD: http://www.oecd.
org/tax/transparency/eucommissionsannouncementonnon-cooperativejuris
dictionslettertoglobalforummembers.html
xi International Tax Plaza. (2015, 6 15). OECD Secretary General Angel
Gurría expresses his concerns regarding the European Commission’s list
of non-cooperative jurisdictions. Retrieved from International Tax Plaza:
http://www.internationaltaxplaza.info/homepage/news-archive/newsarchive-june-2015/1118-oecd-secretary-general-angel-gurria-expresseshis-concerns-regarding-the-european-commission-s-list-of-non-cooperative-tax-jurisdictions
xii The Economist. (2016, 9 10). The Holdout: The Bahamas cocks a snook
at the war on tax-dodgers. Retrieved from The Economist: http://www.
economist.com/news/finance-and-economics/21706516-bahamas-cockssnook-war-tax-dodgers-holdout
xiii The Nassau Gaurdian. (2016, september 13). Bahamas Rejects Outright
The Economist Article. Retrieved from The Nassau Gaurdian: http://www.
thenassauguardian.com/bahamas-business/40-bahamas-business/67764bahamas-rejects-outright-economist-article
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