Bermuda: Richards meets EU to address tax ‘blacklist’

By added on 30/06/2015

Finance Minister Bob Richards has met members of the European Union to address the Island’s inclusion in a tax-dodging “blacklist”, reports Royal Gazette.

Speaking in the House of Assembly on Friday, Mr Richards said he had talks with representatives of the Organisation for Economic Cooperation and Development (OECD) as well as high-level EU figures during a trip to Europe.

He met Angel Gurría, the secretary general of the OECD in Paris, along with the organisation’s head of taxation and the secretary of the Global Forum.

“We were advised that Bermuda is highly regarded and held as a shining example of co-operation and transparency, and is a leader in the field in the Global Forum,” Mr Richards said. “Mr Gurría congratulated Bermuda on being one of the first early adopters of the automatic exchange project.

“This is due not only to the good work of this and former parliaments of Bermuda, particularly the excellent work of the Ministry of Finance’s Wayne Brown, the chief representative at the Global Forum.

“Bermuda’s absence of taxation on companies and individual’s revenues and profits is ‘no problem’ for the OECD. Transparency and co-operation were the key issues, and here Bermuda is top of the class.

“The OECD is extremely unhappy by the listing by the EU last Wednesday. Mr Gurría has taken the unprecedented step of writing a letter, which I have been copied, to the EU Tax Commissioner [Pierre] Moscovici to express his and the OECD’s serious disappointment at the commission’s move, which he said tended to undermine all the work the OECD and the Global Forum have done to promote a single standard for blacklisting throughout the world — namely fiscal transparency.”

Mr Richards said he was told the OECD was 100 per cent behind the Bermuda Government in its objections to the listing, and would support the Island’s efforts to be removed from the list.

He said he then went on to meet senior officials with the European Commission, who expressed sympathy for Bermuda’s predicament and undertook to raise the issue with Mr Moscovici’s cabinet to explore how Bermuda could be quickly delisted.

“Most importantly, he said there would be no spillover affect as far as Solvency II equivalence was concerned,” he said.

Mr Richards said he then met the ad hoc tax committee of the EU Parliament, including a number of heads of political groups.

“This was an opportunity to tell the Bermuda story to a significant number of influential MEPs, most of whom were part of the powerful Economic Monetary Affairs Committee, which will play an important role in the equivalence decision,” he said.

“We were able to tell the MEPs about the very positive perception of Bermuda’s track record in the Global Forum given by the Secretary General of the OECD. We also explained the wholly unjustified inclusion of Bermuda on the commission’s new list and the efforts we are making to obtain delisting in the shortest possible time.

“The questions asked reflected the fact that most of those present were from the socialist or liberal wings of the parliament. The MEPs were visibly surprised to hear that Bermuda led the way on central registers for company’s interests and included the ultimate beneficiary owners of trusts in its register, unlike the UK.

“The takeaway message from this briefing was that MEPs are very susceptible to stereotyping all dots on the map, and the only way to combat this stereotyping is the kind of engagement that we took this week.”

Mr Richards described the meetings as “broad and positive”, adding that they laid the groundwork for Bermuda to be removed from the “blacklist”.

“The only thing that Bermuda has to do is get two countries that has Bermuda on its blacklist now to say that they are not on the blacklist anymore,” he said. “Just two. We’ve already got one, Poland. We just have to find another one.

“There are a number of countries that have us on their list for reasons that are not justified or acceptable, but the EU is already sort of backing off their list anyway. While I was there they claimed that it actually wasn’t a list.

“Insofar as we’re concerned, we just need to work on some of the individual countries that have us blacklisted for clearly what are not justifiable reasons. If we can get enough of them to agree with us, then we come off the list, even if it’s not a list.”