Federation closes tax information exchange agreement with Australia (Photo by Erasmus Williams)

BASSETERRE, St. Kitts – AS the March 31 deadline for regional territories to sign Tax Information Exchange Agreements (TIEAs) draws close, the Federation has signed an agreement with Australia, leaving two more TIEAs to meet the minimum requirement.

This brings to 10 the total number of TIEAs signed by the Federation in an attempt to graduate from the gray list of “secretive tax havens” set down by the Organization of Economic Cooperation and Development (OECD).

The signing was done by St. Kitts-Nevis Prime Minister Hon. Dr. Denzil Douglas and Australia’s Non-Resident High Commissioner to St. Kitts-Nevis, His Excellency Philip Kentwell.

In commenting on the recent signing, PM Douglas said that his government has “done everything that we could do” to comply with the international standards of accountability and transparency of the nation’s offshore business. 

“Governments are saying to the investors they cannot really do business profitably with these countries if they continue to be labelled as tax havens. It is for us therefore to remove that label so that Foreign Direct Investment can come into our country and assist us in the development programmes.

“That’s why we are fighting so hard to get these agreements signed, because they are critical to the continued growth and development of the national economy, specifically the financial services sector,” Douglas noted in a press briefing following last Friday’s (Mar. 5) meeting of the Eastern Caribbean Central Bank Monetary Council.

According to a recent press statement released by the Communications Unit in the Office of the Prime Minister (CUOPM), Australia’s Ambassador Kentwell congratulated the local government for its progress in working to meet the OECD deadline.

“As we appreciate, the whole financial services industry is one which we need to ensure is managed carefully to encourage confidence and this agreement between our two countries is going to further strengthen the relationship that we already enjoy,” the Australian official said.

In late February, France blacklisted 18 countries located outside of the European Union as “uncooperative” with the OECD demands, including St. Kitts-Nevis. The French government also decided to increase taxes for businesses with subsidiaries in these territories – a move that PM Douglas viewed to be premature and “against the commitment that was made with the OECD countries”.

To date, TIEAs have been signed with Monaco, the Netherlands, the Netherlands Antilles, Aruba, United Kingdom, Denmark, Belgium, New Zealand and Liechtenstein. March 24 is the deadline set for the Federation to make similar agreements with six Nordic countries and finally onto the OECD white list. 

According to CUOPM, St. Kitts-Nevis has already initialled or concluded TIEA negotiations with and is awaiting dates for signature with Canada, France, Germany, Norway, Sweden, Greenland, Faroe Islands, Iceland, Finland and San Marino.