A senior Organisation for Economic Co-operation and Development (OECD) spokesperson yesterday stated that the organization is "extremely happy" with The Bahamas' strides in advancing transparency within the financial services sector, making the European Union's (EU) blacklisting of The Bahamas all the more "unfair".
Pascal Saint-Amans, director of the OECD Centre for Tax Policy and Administration, commended the jurisdiction's progress in implementing the OECD's automatic exchange of information (AEOI) standard for financial reporting, noting that there was little left for the country to do ahead of 2018. With The Bahamas largely compliant with the OECD's existing standard of exchange of information on request, Saint-Amans stated that he is "extremely confident" in the country's ability to fulfill its reporting obligations by the slated 2018 deadline.
"There is nothing else you can do for the time being, even though there are some challenges for the implementation for the automatic exchange of information," he said. In June, the EU Commission included The Bahamas in a list of "third country non-cooperative tax jurisdictions" despite The Bahamas' compliance with most recent international standards. Saint-Amans was one of two high-ranking OECD officials who stood up in support of The Bahamas and a number of other states following their "unfair" inclusion on the EU tax blacklist, which he described as "inconsistent."
"You've done what you had to and therefore it's very unfair that you end up on the blacklist, which actually is not even a list - it's just a compilation of existing lists that are inconsistent," Saint-Amans said. However, Saint-Amans did not go into detail regarding the challenges facing The Bahamas as it prepares for AEOI compliance. Local industry stakeholders condemned the placement of The Bahamas on that list, with Minister of Financial Services Hope Strachan questioning how the country ended up on the list. However, Strachan yesterday said that Saint-Amans' visit gave a "good signal" for the strength of the industry moving forward.
"We believe that Mr. Saint-Amans has been able to confirm to the industry that the blacklisting was not an OECD initiative and that the industry in The Bahamas is still regarded as a compliant jurisdiction, that the industry is still strong, and that we're able to move forward with the regulatory programs that the OECD has established over the course of the year. "We believe that this is a good signal for the industry moving forward. It gives us a sense of comfort, so to speak," said Strachan. The meeting comes a week after the Department of Statistics revealed a 36 percent jump in unemployment amid the country's "finance, insurance, real estate and other business service" sector.
Since the release of the figures, Strachan has vowed to bolster the financial services sector by targeting new markets and diversifying the country's financial products. Saint-Amans was in The Bahamas to brief industry stakeholders on the blacklisting as well as the OECD's base erosion and profit shifting (BEPS) project, which aims to plug holes in tax rules whereby international corporations shift profits to lower tax jurisdictions to reduce overall corporate tax fees.
According to the OECD is an initiative is an ""attempt by the world's major economies to try to rewrite the rules on corporate taxation to address the widespread perception that the [corporations] don't pay their fair share of taxes."
Click here to read more at The Nassau Guardian
