The Tribune

By Fay Simmons

Tribune Business Reporter

jsimmons@tribunemedia.net

A Cabinet minister yesterday voiced optimism there is “momentum building” for a push to snatch control of international tax policy away from the European Union (EU) and OECD.

Michael Halkitis, minister of economic affairs, said Caribbean and African nations, as well as international financial centres (IFCs), were uniting in a bid to ensure such matters are dealt with under the United Nations (UN) - a forum they feel will be fairer and more attuned to their interests.

Speaking at the Prime Minister’s weekly press briefing, Mr Halkitis argued that the EU and Organisation for Economic Co-Operation and Development (OECD) are not the best arbiters or policy setters on international tax issues because their members compete directly with those nations they blacklist for financial services business.

“The wider point I want to just flag, and we’ll be discussing this as time goes on, is our view that we should move this whole issue of who is compliant and who is not compliant out of the hands of the OECD and the European Union to the United Nations, who we think would be a more independent arbiter of this whole issue,” he explained.

“We do not think that jurisdictions who are in competition with us and other jurisdictions, in terms of financial services, should be the judge and the jury of who’s being compliant in terms of their tax standards.... There should have been a meeting on this this coming Monday in Barbados to discuss that very issue. Unfortunately, that meeting has been postponed.

“But there is momentum building in the region, in what we call the global south, in certain places in Africa and the east, that we need to change this calculation. Who determines who is compliant or non-compliant? That’s gaining momentum. We want to see it go to the UN who has no interest in competing for financial services.”

The Bahamas remains on the EU’s revised list of non-cooperative jurisdictions for tax purposes. Mr Halkitis said the EU decision was made based on the April 2023 report by the OECD’s Forum on Harmful Tax Practices, which did not account for the reforms subsequently implemented by The Bahamas to address both groups’ concerns.

He maintained that the Government is “optimistic” that The Bahamas will receive a “favourable review” from the OECD this month, and that this will be taken into consideration by the EU when it next reviews its tax blacklist in February 2024.

Mr Halkitis said: “I wanted to make the point that it’s a matter of scheduling. We have not been standing still. We have done a lot of work and we are optimistic for a positive outcome. I don’t agree with the process but, as it stands, that is what we have to react to.”