Europe says Barbados is a non-cooperative tax jurisdiction, a development which is sure to bring the island’s offshore financial sector under more international scrutiny.
The Brussels-headquartered European Commission, executive arm of the 28-nation European Union, yesterday named Barbados along with eight other CARICOM countries, one U.S. and six British Caribbean territories on a list of 30 non-cooperative tax jurisdictions.
Reacting to the development, the island’s business minister Donville Inniss told Barbados TODAY it was “utterly wrong and totally unfair”.
“We will fight this,” added Inniss, who is scheduled to hold a press conference tomorrow on the issue.
However, in explaining the development, Head of the EU Delegation to Barbados and the Eastern Caribbean, Ambassador Mikael Barfod said: “This list is ‘nothing new’ as it is only a compilation of the lists of our member states.
“It is part of the Commission’s attempt to develop a common EU wide approach to corporate taxation to ensure its transparency and fairness, when currently member states have very different definitions even of what constitutes a tax haven”.
The Commission’s list, the EU Delegation explained in a statement, was based on EU member states’ lists as they were communicated to the Commission in December 2014. The Commission will amend this list at least once a year to reflect changes to member states’ national lists.
The statement said: “The consolidated list is not an assessment by the Commission but a compilation of existing lists of EU memberstates which looked at how non-EU countries and territories around the world apply standards of good tax governance. These standards vary, but generally include transparency, exchange of information and fair tax competition.”
The statement went on: “The consolidated list will allow EU member states to compare their national lists in an easy and transparent way and can be used to screen non-cooperative tax jurisdictions and develop a common EU strategy to deal with them. As such, it will reinforce member states’ collective defense systems against tax havens.”
As a next step, the statement said, the Commission recommends that member states (within the Code of Conduct Group) should screen the “top 30” listed countries and territories and determine an appropriate EU response.
It noted that the Code Group’s work has delivered successful results in relation to non-EU countries in the past. For example, Switzerland agreed to eliminate some of its harmful corporate tax regimes following scrutiny by the Code Group.
EU Economic Affairs Commissioner Pierre Moscovici told a news conference yesterday the publication of what was described as this blacklist of 30 countries and territories was a “decisive step” aimed at getting “non-co-operative non-EU jurisdictions to be more co-operative and adopt international standards.”