CARICOM VOWS TO HAVE A UNITED VOICE AGAINST EU’S SHIFTING TAX REQUIREMENTS

BASSETERRE, St. Kitts, February 28, 2019 (Press Unit in the Office of the Prime Minister) – Heads of Government of the Caribbean Community (CARICOM) are of the view that the European Union’s approach to “tax good governance” is an infringement on sovereignty, and one that is coercive and harmful to the future of a key economic sector in CARICOM.

Chairman of CARICOM and Prime Minister of St. Kitts and Nevis, Dr. the Honourable Timothy Harris, said the arbitrary and shifting requirements of the EU’s tax requirements have considerable reputational damage to Caribbean countries which are irreparable and have consequential implications for building Member States’ economic and climate resilience given the region’s inherent vulnerabilities.

The CARICOM Chair added, “We do not think that it has the appeal of a democratic process or a consensual process and we take exception to that matter. Each time there is one problem [and] that problem is addressed, by the next time the EU comes around there is a second and third problem. So the goal post keeps shifting in a way that makes management of the industry difficult and creates uncertainty.”

In this regard, CARICOM Secretary-General, Ambassador Irwin LaRocque said the regional body must continue to use a united voice in reaching out to the European Union (EU), allied countries and countries outside the EU bloc to build their case against this matter.

The Ambassador said, “There comes a point when you have to say to them ‘if you’re not going to have some meaningful dialogue, if you are not going to have some understanding on the circumstances in which we are, then we’ll have to have recourse to other things. We have 14 Member States that collectively when we act together, which is not infrequent, can have a voice internationally. We’ve done it before and we are seeking to see how we can do this again.”

Ambassador LaRocque stated that the European Union has taken it upon themselves to “set certain criteria which go above and beyond criteria set by the OECD [Organisation for Economic Co-operation and Development], which is the recognized international body that looks at matters of tax and good governance.”

“In particular, we are extremely concerned that opportunity for dialogue with Member States who are so blacklisted or greylisted is almost non-existent. We feel that it is a significant overreach into the sovereignty of Member States and we go so far as to consider it, especially for those Member States whose economies rely heavily on the international business sector, an assault on the economic economies of these countries,” the CARICOM Secretary-General stated.

The official communiqué issued at the end of the 30^th Inter-Sessional Meeting of Heads of Government states that CARICOM Heads have proposed that the EU should adopt a more collaborative approach which would allow Member States to conduct the required impact and sensitivity analyses to determine how to further align their tax regimes with global standards for tax transparency and governance.