Efforts by one American state to officially label St Kitts and Nevis a foreign tax haven are being strongly objected to by the federation’s Foreign Affairs Minister Mark Brantley.
As WINN FM has been reporting, a proposed House Bill 3419 in the state of Illinois has listed St. Kitts and Nevis as a “foreign tax haven”.
The bill is targeting Basseterre and 17 other Caribbean countries, and if successful, would impact negatively on them.
Minister Brantley explains that the St Kitts and Nevis government has sought to intervene at an early stage with the legislature in Illinois.
“To seek to set the record straight so to speak and alert them to the fact that St Kitts and Nevis is not a tax haven and in fact we have been doing what we need to do in terms of compliance with the international community. We see no basis whatsoever for us to be singled out in this fashion by the state of Illinois or by any other state or country. What is particularly puzzling is in relation to the United States, is that we have excellent relations with the United States federally, we participate in organizations such as the OECD and the Global Forum and Tax transparency with the United States as a country. What we are seeing however is a strange phenomenon where individual constituent elements of that country, being the various states, have determined that they have the right to blacklist sovereign nations.”
The foreign affairs minister says that issue has already been raised with the United States government, and the matter is also being pursued at the diplomatic level.
“Because it’s odd to have a clean slate so to speak with a country, to break it down, it’s as if St Kitts and Nevis and Antigua have no problem but the island of Nevis or for that matter the village of Sandy Point were to decide that they wanted to take action in relation to a sovereign state Antigua. So we have a concern about that approach, it might be something that is permissible under US domestic law but we think it violates international law and international norms.”
According to Minister Brantley, Caribbean countries are being unfairly targeted as so-called foreign tax havens.
He says in the case of St Kitts and Nevis the perception is wrong.
“I think it’s simply because we are in the Caribbean frankly put, what we see is a broad brush in most if not all of the Caribbean countries. We are small we are vulnerable, we don’t have the lobbying ability, we don’t have the wealth and the might to deal with many of these matters and I think we are easy targets. Many of these countries feel that when they are going to drop these lists of countries who they feel are uncooperative they first target the Caribbean. Similarly when they talk about Citizen by Investment Programmes they target those in the Caribbean forgetting conveniently that major European countries such as Portugal and Malta and others, even the great United States with its EB-5 visa programme or Canada and many countries have programmes that they offer, but of course it’s far easier to target and label the Caribbean of little islands as some Shangri La where bad things happen. The truth is those labels do not fit the evidence, the evidence speaks to the contrary. The Caribbean has done a good job and speaking specifically of St Kitts and Nevis we’ve done an excellent job.”
The country’s permanent representative to the Organization of American States, Ambassador Everson Hull has already expressed his concern with St Kitts and Nevis being branded a tax haven.
Ambassador Hull contends that a select few cash-strapped states in the U.S. whose revenue flows have been severely harmed by the protracted slowdown in U.S. economic growth over the past eight years, are of the mistaken view that somehow their revenues are lying idle in low-tax offshore jurisdictions such as St. Kitts and Nevis.
He calls it a contention that is fatally-flawed.
Ambassador Hull says too that there is no information regarding the tax liabilities of U.S. companies or persons domiciled in the Federation of St. Kitts and Nevis that is not readily available to the U.S. Government and the IRS.
He points to binding legal agreements that are firmly in place between the U.S. and St. Kitts and Nevis, including FATCA, that expressly forbid the hiding of taxes due to the U.S. Government.
Source/Ken Richards – WINN