Minister of International Business Donville Inniss has seen an opportunity for Barbados to raise its profile as a tax jurisdiction, amidst the Panama Papers scandal.
Thirty-four unnamed companies from Barbados have been listed in the Panama Papers, described as history’s biggest data leak with an unprecedented 11.5 million files from the database of the world’s biggest offshore law firm, Mossack Fonseca.
Inniss said Barbados was not a tax haven but a compliant jurisdiction with legitimate tax structures.
This, he said, was a feature the country should promote to its advantage.
“The opportunity for Barbados in all of this is to promote itself as a jurisdiction of substance that is well-regulated and a low tax jurisdiction,” the minister told Barbados TODAY.
Inniss warned that the scandal would place companies involved in international business under even greater scrutiny, adding that Barbados had been through in its regulatory process.
“The negative aspect of it for all of us is that there will be a bit more intense scrutiny on our activities. On the positive side though, Barbados continues to position itself as a well-regulated, low tax jurisdiction, which has always been the case, with businesses of substance. And we have placed heavy emphasis on a high level of regulation,” Inniss said.
The minister acknowledged that despite their best efforts, including comprehensive background checks, no country would be “100 per cent foolproof” at all times.
“It means that there may always be companies that come and register purporting to do one thing, even without the knowledge of the service provider, and may be in the international arena doing things that we may not be aware of,” he explained.
“But we have found ways to tighten up the regulating of these entities and where the provider or state agency recognizes that they are not acting in accordance with Barbados’ laws, then we are quick to ask them to come off our jurisdiction.”
He disclosed that Barbados would soon undergo a peer review by the Organization of Economic Co-operation and Development (OECD) Global Forum that would examine the regulatory aspect of the international business sector here.
Inniss was confident that the island could stand up to scrutiny, pointing out that Barbados was a big promoter of various standards and requirements for entities coming to do business.
Inniss stopped short of saying there were no concerns over the naming of the Barbadian companies, suggesting that all companies named in the Panama Papers had little to do with tax evasion by high net worth individuals and instead looked at whether companies were operating legally or legitimately.
“I bet at the end of the day when the dust is all settled the legality of these structures fall within the law of the countries within which they are operating. The spotlight is on politicians, their families and friends,” he said, maintaining that Barbados was on the right course in developing the international business sector.
So far, the Barbados International Business Association has opted not to comment on the matter. (MM)