The international business and financial services sector is poised to undergo a series of critical changes, including legislative changes, according to Minister of International Business and Industry Ronald Toppin.
“The sector will therefore, be re-engineered to boost not only our foreign reserves, but also the provision of jobs and the attraction of international investors,” Toppin today told the second consultation of corporate and trust service providers at the Savannah Hotel.
“We have reached a critical stage in our development, where we have to make fundamental changes in the international business framework. This is primarily because the Forum on Harmful Tax Practices (FHTP) has deemed Barbados’ preferential regimes to be potentially harmful,” the minister said.
He explained that in keeping with Barbados’ commitments to the international community, there would be changes to a number of pieces of legislation “to incorporate the standards agreed to, if we are to be compliant with anti Base Erosion and Profit Shifting (BEPS) standards”.
The BEPS rules is designed primarily to tackle those who exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax jurisdictions.
In recent years the Organization for Economic Cooperation and Development (OECD) has listed Barbados as “largely compliant”, with regimes governing the sector.
Toppin reported that in keeping with commitments to the FHTP, new guidelines were recently issued relating to intellectual property benefits under the relevant legislation.
“That statement signalled the beginning of changes to be made to the manner in which we will be operating in relation to the international business sector,” the minister said.
He also reiterated that a task force, led by the Barbados International Business Association (BIBA), was currently developing recommendations for Government’s consideration on how Barbados should address the concerns of the FHTP.
He gave the assurance that as soon as issues were settled with the OECD and the European Union regarding BEPS, and all deadlines were met, Barbados would move swiftly towards the establishment of a framework of legislation “that will help cultivate both the types and volumes of business from which Barbados would benefit”.
Toppin also gave the assurance that his ministry would work closely with the sector officials and related Government agencies in order to grow existing markets and tap into new ones, including South and Central America, “as well as enhance our traditional relations with partners such as post Brexit UK, Canada and the EU”.
During the start of today’s consultation Director of the International Business Unit Kevin Hunte said the BIBA-led task force had already presented three drafts, adding that among other things, the committee was examining the introduction and adoption of various measures to enhance the sector.
“It is believed by both Government and the task force that perhaps Barbados has arrived at the time to restructure our tax systems and to make radical changes that are necessary so as to position Barbados as the jurisdiction of choice,” Hunte said.