St Vincent blasts EU over ‘blacklisting’
The Financial Services Authority (FSA) in St Vincent and the Grenadines has described as "arbitrary and not supported by any objective or transparent process" the decision by the European Union (EU) to place the country on its first list of international tax havens.
"St Vincent and the Grenadines intends to object to this blacklisting on an individual basis and from a unified Caribbean front," the FSA said in a statement.
The island is among 13 Caribbean countries named by the European Union in a list containing 30 countries released last week.
The list covers Anguilla, Antigua and Barbuda, The Bahamas, Barbados, Belize, Bermuda, British Virgin Islands, Cayman Islands, Grenada, Montserrat, Panama, St Vincent and the Grenadines, St Kitts and Nevis, Turks and Caicos and the US Virgin Islands, among the 30 countries operating as tax havens.
The list is part of a crackdown on multinational companies trying to avoid paying taxes in the EU bloc.
The European Commission is proposing reforms to end sweetheart tax deals following a series of investigations into arrangements between EU countries and firms, including Amazon, Apple and Starbucks.
But the FSA said the blacklisting is considered "unjust, amounting to an abuse of process/power".
It pointed out that St Vincent has amended its laws and implemented a tax information exchange system to conform to international standards and built a successful tax information exchange regime.
"Of absolute significance is that St Vincent and the Grenadines has already been assessed as not being a tax haven by the OECD (Organisation for Economic Cooperation and Development), the responsible international body for international tax compliance purposes," the FSA said.
The Grenada government, too, says it is "extremely disappointed" by the decision of the EU to include it in the list of 30 countries named as international tax havens.
"Grenada's inclusion implies that Grenada is not doing sufficient to guard against harmful tax practices," Prime Minister Dr Keith Mitchell told legislators.
In response to the EU's list, the OECD and the Global Forum said "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".
"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. We have already expressed our concerns and stand ready to further clarify to the media the position of the affected jurisdictions with regard to their compliance with the Global Forum standards," they said.
The FSA said St Vincent and the Grenadines is "white listed" by the OECD, having successfully completed its mandatory two-phase assessments.
Some 11 EU countries - Bulgaria, Croatia, Estonia, Greece, Italy, Latvia, Lithuania, Poland, Portugal, Slovenia and Spain - have listed St Vincent as non-cooperative. However, the FSA said the island "has never had a request for tax information or any other information from any of those countries, nor refused any international request for tax information" made by them.