St. Kitts and Nevis blacklisting by EU Commission draws attention from OECD Global Forum

The federation was listed among 30 financial services jurisdictions, including several Caribbean countries, in a June 17 listing issued by the European Union Commission, just as the EU announced intentions to address, significantly, corporation tax avoidance. According to information from the EU Commission, the listed countries were “not doing enough” to tackle tax avoidance by individuals and companies in the context of international financial services.

Attempts Friday to reach the federation’s financial secretary for comment on the development were unsuccessful. Meanwhile, the prime minister’s Press Secretary Clecton Phillip issued a statement that indicated the government’s intentions to write to the EU and record the nation’s objections over inclusion and pointing out the country’s compliance to accepted international standards.

As that process takes shape, however, a new twist has developed with the OECD Global Forum Secretariat itself responding to the European Union Commission’s actions. In a statement, signed by the Director of the OECD Centre for Tax Policy and Administration (CTPA), and the head of the Global Forum Secretariat – CTPA’s Director Pascal Saint-Amans and the Global Forum Secretariat’s head, Monica Bhatia – it points out to the EU Commission that some of the blacklisted countries were cooperative.

The information reads in part, “As the OECD and the Global Forum, we would like to confirm that the only agreeable assessment of countries, as regards their cooperation, is made by the Global Forum and that a number of countries identified in the EU exercise are either fully or largely compliant and have committed to AEOI, sometimes even as early adopters.”

It continued, “Without prejudice to countries’ sovereign positions, we are happy to confirm that these jurisdictions are cooperative, and we would like to commend the tremendous progress made over the past years, as well as the cooperation and integrity of the Global Forum process.”

Regardless of this acknowledgement by the OECD Global Forum, which ensures implementation of internationally agreed standards of transparency and exchange of tax information in its 126 member countries, the federation will proceed to lodge its formal objections to the EU Commission.

According to the press secretary, the country will record its objections based on the following record of compliance:

1.   In our recent OECD Global Forum peer review on our effectiveness in exchange of information, the federation received an overall rating of “Largely Compliant”, which puts us among the best performers internationally in the area of observance of international standards on Transparency and the Exchange Of Information (EOI) on tax matters.

2.  The federation has an extensive tax information exchange treaty network with 25 countries, many of which are major EU Member States.

3.  St. Kitts and Nevis has been cooperative with our treaty partners in responding to requests for information in a timely manner.

4.  The federation has been actively involved with the work of the OECD on tax transparency since 2001 and continues to be an active player on the subgroup of the OECD on Automatic Exchange Of Information (AEOI) and standard setting.

The formal complaint is expected to be delivered in the coming week.

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