Local officials are happy, following Barbados’ removal from the European Union’s (EU) ‘blacklist’ of non-cooperative tax jurisdictions.
News of the island’s removal came this morning from the EU Council, which pointed out that two other Caribbean countries, Bermuda and Aruba, have also been removed.
While Aruba has been removed entirely, Barbados and Bermuda have been moved to the so-called grey list.
However, addressing a press conference at Government headquarters today, Prime Minister Mia Mottley said she was thankful.
“Today we have that to be thankful for the removal from that blacklist,” said Mottley, while thanking all those who were instrumental in the process.
In its statement, the EU said: “Barbados has made commitments at a high political level to remedy EU concerns regarding the replacement of its harmful preferential regimes by a measure of similar effect, whilst Aruba and Bermuda have now completed their commitments”.
Mottley told journalists that the removal of Barbados from the blacklist meant that “insurance companies that could have left us will not now do so because they will not be prohibited from doing business in Europe as a result of the blacklist. So this has tangible meanings for us”.
However, she quickly pointed out that battle was still not over.
After racing against the clock at the end of last year making changes to tax regimes in order to meet the Organisation for Economic Corporation and Development requirements, Barbados has also made several supporting legislative changes in the first half of this year.
“It doesn’t mean that the battle is over because we live in a world, quite frankly, that persons will want to continue to extract every competitive advantage that they can.
Competitive advantage also comes from the perspective of the imposition of rules, bureaucracy that will act as a non-tariff barrier in real terms to keep some countries uncompetitive,” said Mottley.
At the same time, Mottley acknowledged that the world was constantly changing and evolving, and said she believed the day will come when companies are either taxed differently or have no tax at all.
“I truly believe that corporation tax over the next 20 to 30 years may not exist in the same way because it is too difficult for governments to track, so that more governments will tax transactions and tax assets,” she predicted.
Executive Director of the Barbados International Business Association (BIBA) Henderson Holmes also expressed joy that the country was removed form the EU’s blacklist.
He agreed that being on any blacklist would affect potential and existing investor sentiments, but said he was not aware of any company that was planning to pack up and leave as a result of the country being on the blacklist.
“Obviously if you hear there is a country on a blacklist a lot of things start going through your head,” said Holmes, who pointed out that some people would immediately start thinking something egregious such as money laundering was taking place.
However, he made it clear that Barbados being placed on the EU’s blacklist in the first place had nothing do with that and everything to do with what regime and rules the EU and the OECD wanted.
“This seem to me to be a matter of sovereign right, but we have these bodies that seem to think otherwise,” he said.
“We don’t know what demands will be made next year or the year after because the goal post keeps changing,” he added. email@example.com