Mon | Feb 19, 2018

Dominica PM ruminates on blacklisting rich countries

Published:Thursday | December 21, 2017 | 12:00 AM-CMC
Prime Minister of Dominica, Roosevelt Skerrit.

Dominica's Prime Minister Roosevelt Skerrit on Tuesday appeared to advocate for Caricom countries to consider placing international countries on a blacklist, but the comments appeared to be emanating from frustration rather than consideration of a new approach to tax policy.

It comes after the inclusion of several Caribbean countries on a list of tax havens by the European Union (EU) action that has angered and annoyed some regional leaders. Dominica was not on the list.

"We always maintain in Caricom that we do all what we have to do to ensure and assure the security of the world. People have to appreciate, too, that in our small jurisdictions there will always be certain capacity constraints. But I think Caricom should start coming up with its own list, too, and start blacklisting countries likewise," Skerrit said at a news conference.

"Is that a practice we should take or route we should take?" he asked, before cutting his comments short. "I think I should end there, I think I should end here on this," he told reporter, while laughing out loud at his own comments.

"But just to say, I think it is unfortunate," he said.

Earlier this month, EU finance ministers meeting in Brussels named St Lucia, Barbados, Grenada, and Trinidad & Tobago among a list of 17 countries considered to be global tax havens. They said the new list had been drawn up after 10 months of investigations by EU officials.

The ministers said the countries on the blacklist were not doing enough to crack down on offshore avoidance schemes. Potential sanctions that could be enforced on members of the list are expected to be agreed in the coming weeks.

The EU said that as a first step, a letter will be sent to all jurisdictions on the new list, explaining the decision and what they can do to be delisted.

Last weekend, the 15-member Caricom bloc "strongly" objected to the move by the EU. Secretary General Irwin LaRocque said regional countries had been blacklisted even though they have not been so labelled by the relevant regulatory authorities, such as the Financial Action Task Force and the OECD Global Forum.

"This decision by the EU has been based on new and unilaterally determined criteria that go beyond the generally accepted international tax transparency and accountability standards which our countries have been diligently meeting over the past several years," he said.

At his news conference, Skerrit noted that his country's official position aligned with Caricom's. He also questioned whether the EU fully appreciated the consequences of blacklisting small economies or had fully thought through their actions.

"I don't know if they don't understand the implications for the economies of these countries. You get the sense that there's no real sensible conclusion or basis upon which they came to these conclusions," said Skerrit. "It is unfortunate."

Last weekend, Barbados Minister of Industry, International Business, Commerce and Small Business Development Donville Inniss said he still did not know what specific problems the EU had identified with Barbados.

Inniss said that in the absence of clarification from the EU, it was difficult to determine what steps his country needed to take in order to be removed from the list.

"My approach is to work together with the EU and their representatives on finding a speedy resolution to the issue, but first we have to know from their end what the major issue is," Inniss said.