With over $200 million in losses reported since 2007, the Executive Director of Barbados International Business Association (BIBA) Henderson Holmes today expressed strong concern that the country’s number two sector after tourism was fast losing money.
“In 2007 our total contribution from the international business sector through corporate tax was just over $350 million. My understanding is that the recent figure it is about just over $100 million,” he said on local radio this morning, adding that “we have to add to that PAYE [Pay As You Earn taxes deducted from salaries] on the payrolls of these companies”.
Holmes further pointed out that the loss of income was not in Barbados dollars.
“We also have to take into account that all money that you talk about with these companies putting in this economy. . . is all foreign exchange,” he said, stressing that “the impact of this sector on our economy is being felt today.
“What you could say about our foreign reserves, what you could say about our fiscal position you can take it right back to the fall off in the international business sector,” he added.
His comments come against the backdrop of the recent revocation of four offshore licences.
Without identifying the companies by name, Inniss revealed last Friday that the four were found to be involved in “illicit activities”.
Pressed by reporters yesterday, Inniss again refused to give names, while stressing that their departure after the revocation process was complete would have no meaningful impact on Barbados’ revenue from the sector.
“There is no significant loss in revenue to Barbados. But more importantly, why would revenue loss be of any interest?” he asked under questioning from the media following a church service at the St Matthias Church to launch a week of activities marking BIBA’s 20th anniversary.
Inniss said he preferred to focus on “the revenue that we would not get if we didn’t do the things we have to do to protect the reputation of Barbados.
“So I’m not going to get involved in any dollars and cents,” he added.
With correspondence on the revocation of licences yet to be sent to the various parties and the revocation placed in the Official Gazette as legally required, Inniss was equally adamant that “I’m not going to issue a press release from my ministry providing names and details on companies.
“I shall not do that,” he insisted, adding that at the end of the day these things also give us a bad rep when we start to put [information] into the public domain through press releases and name-calling.
“The names of the entities will be released in due time. I’m not going to get into any public discussion as to exactly what they did,” he stressed.
Earlier, in an address to the church gathering, Inniss had said there was need to ensure that Barbadians knew more about the sector in general.
“We still have a little ways to go to get to the point where international business is seen as everybody’s business in Barbados,” he said, adding that “we really wish to make this sector better known”.
During his address the international business minister also spoke of the “myriad of challenges” the sector faced on “an almost daily basis . . . in continuing to get out there and defend this domicile and its reputation as a country that is not involved in illicit activities; one that is not a tax haven, [but] one that seeks to encourage and foster development of businesses of substance in our domicile”.
However, he said: “We currently have over 4,000 companies operating in the international business financial services sector in Barbados.
“There are perhaps a similar amount of individuals employed in this sector as well. And we contribute almost $900 million to the Barbados economy on an annual basis. And that is growing.”
Inniss, in stressing the impact of the sector on the economy, also said it helps to showcase that Barbados can punch above its weight in global affairs”.
Tourism is responsible for over US$1 billion in earnings annually.