- Trade war worries slam China and emerging markets Read More
- Caribbean Airlines ranked 34th in global on time performance Read More
- Ticket sales slow Read More
- Pinnacle challenge to Gandalf Read More
- Where’s the morality, bishop? Read More
- Initiatives to help us stay afloat Read More
- Machel to Rise at Oval Read More
BASSETERRE – The St Kitts and Nevis government Tuesday maintained that the twin island Federation is a “committed and fully cooperative jurisdiction in the context of international tax transparency” as it responded to the decision by the European Union to label it a tax haven.
In addition to St Kitts and Nevis, the European Finance Minister named the US Virgin islands and the Bahamas as countries that have not complied with the tax requirements as set out by Europe. Nassau has since disagreed with the designation.
In a statement from the Office of the Prime Minister, it notes that in the case of St Kitts and Nevis, the only area of concern from the EU is in respect of Fair Taxation where “a jurisdiction should have no preferential tax measures that could be regarded as harmful and a jurisdiction should not facilitate offshore structures or arrangements aimed at attracting profits which do not reflect real economic activity in the jurisdiction”.
It said that in an official response to the EU, the Financial Secretary Hilary Hazel said that “during the process of engaging with the EU, concrete commitments were made by the Federation to amend the relevant legislation to address the EU’s concerns.
“The Federation remains optimistic that these commitments will persuade EU’s partners to remove the Federation from the list of non-cooperative jurisdictions for tax purposes and allow for a framework of cooperation and dialogue moving forward.”
She said that the “Federation remains committed to the international standards on transparency and exchange of information for tax purposes as evidenced by a largely compliant rating by the Organisation for Economic Co-operation and Development (OECD).
“Further, St Kitts and Nevis has continued to expand its exchange of information network and is a signatory to the Multilateral Convention on Mutual Administrative Assistance for Tax Matters.”
St Kitts and Nevis signed and deposited the instrument of ratification for the Convention on August 25, 2016, the statement said.
It said that legislation was passed by the National Assembly in December 2016 to provide for the implementation of the Common Reporting Standards (CRS).
“The Federation also joined membership of the BEPS Inclusive Framework in November 2017 and is among 112 other jurisdictions that have committed to implementing anti-BEPS measures.”
Regarding the commitments specifically given to the EU, Hazel noted that “we anticipate a series of actions to be taken to ensure that Saint Kitts and Nevis addresses the EU’s current concerns within the stipulated timeframe of 31 December 2018.
“In this regard, Saint Kitts and Nevis will undertake a comprehensive review of its legislation with a view to addressing any deficiencies including amending relevant legislation in accordance with best practice in international tax matters.”
The Financial Secretary also stressed that during the period 2016-2017, important members of the European Union such as Italy, Greece, Poland and Estonia removed St Kitts and Nevis from their national lists of non-cooperative jurisdictions “signifying their satisfaction with the Federation’s efforts on transparency and exchange of information”.
The finance ministers said they had also decided to remove Bahrain, the Marshall Islands and St Lucia, from an earlier list that had also included American Samoa, Guam, Namibia, Palau, Samoa and Trinidad and Tobago.
The EU finance ministers have also decided to add Anguilla, the British Virgin Islands, Dominica and Antigua and Barbuda to a so-called grey list of jurisdictions which do not respect EU anti-tax avoidance standards but have committed to change their practices.
The blacklist was set up in December, but Caribbean islands hit by hurricanes last year were given more time to adapt their tax practices to EU requests.
Earlier this month, the Caribbean Community (CARICOM) leaders who met in Haiti for the 29th inter-sessional summit, called on their finance ministers and central bank governors of the region to meet “expeditiously” to consider new proposals as regional governments continue to react to decisions by Europe in listing some countries as tax havens.
The communiqué issued at the end of the summit noted that the proposals on a CARICOM Strategy had been prepared by a CARICOM Technical Working Group. (CMC)