The head of a local accounting body has blasted as “disingenuous” for the Organsation for Economic Cooperation and Development (OECD) and the Global Forum to label Barbados as a country lacking in transparency.
Institute of Chartered Accountants of Barbados (ICAB) executive director Reginald Farley was responding to a report from the OECD?that Barbados was falling short of current standards on tax transparency and information exchange.
Farley noted: “Barbados has always made a clear commitment to tax transparency and exchange of information, even at a time when competitors were thriving on secrecy provisions in their domestic laws.
“By contrast, this country has always pushed to develop double taxation treaties [DTAs, of which there are 20 plus the CARICOM DTA] which include tax information exchange agreements as an integral element.
“We have concentrated on providing high quality professional services to international companies within treaty networks.
“It is therefore most disingenuous for the OECD and the Global Forum to label Barbados as a country lacking in transparency and unwilling to exchange information.
“What has happened in this case is that some of our tax information-exchange agreements pre-date the current standards and the more recent ones are awaiting ratification by other countries.”
The ICAB official said challenges to the vital international business sector needed to be addressed urgently by Government and the private sector through legislative, diplomatic, and public relations channels.
Government announced that it would be amending the Income Tax Act to expand the scope of the tax information exchange provisions in our existing double taxation treaties to meet the current OECD standard on the exchange of information for tax purposes.
In addition, the move is to enable Barbados to exchange tax information with countries with whom it has initialled or signed a new treaty or protocol, but the treaty has not yet been ratified by the other country.
The ICAB official also raised concern about the actions of the British government through the Finance Act 2010, where the penalty for non-compliance with certain aspects of British income tax law will be determined based on the foreign country involved.
He said Britain appeared to have based the categories on the OECD/Global Forum pronouncements.
“ICAB is concerned that notwithstanding the fact that Barbados has since 1970 had a DTA including tax-information exchange with the United Kingdom, Barbados has been placed in the category for the most severe treatment,” he noted in a statement.
Farley was of the view that this should serve as a wake-up call and a reminder that OECD countries will continue to apply pressure to international financial centres.
“As a nation we need to work as a cohesive unit in addressing these challenges to our economic well-being.” (GE/PR)