Cooper: Bahamas should be proactive on EU blacklisting threat

Progressive Liberal Party (PLP) Deputy Leader Chester Cooper, who is also the shadow minister of finance, yesterday urged the government to be proactive regarding the threat of another European Union (EU) blacklisting for jurisdictions with zero-rated corporate taxes.

Members of the European Parliament (MEP) last week adopted a resolution to put more pressure on the European Commission to keep “tax havens” blacklisted until they make material legislative changes the EU wants. While the resolution must go through various levels before it becomes law, the EU is seeking to have it enforced before the end of the year.

Cooper said the government should not wait for the blacklisting and should leverage its relationships with other nations and international bodies to combat the threat.

“What we know is that the EU will continue to change the standard to which we are held, while not holding their own member countries to the same standard. And what we also know is that they don’t care. We know as well that though we have a diplomatic presence now, our small country does not have the political clout to see these policies altered through bilateral engagement alone,” he said while contributing to debate on the extension of the emergency orders in the House of Assembly yesterday.

“What I’ve always urged is that we remain proactive on this front. We shouldn’t wait for the new blacklist to figure out what we need to do to get off it. So, since we already have the mission in Brussels, we should use that to recruit more weighty players to our cause.”

Cooper said The Bahamas should band together with the Caribbean Community (CARICOM), or even the African, Caribbean and Pacific Group of States (ACP) – which is also represented in Brussels and may also have similar concerns – lest it finds itself “scrambling yet again”.

“For instance, we could engage the European Banking Federation, which is in Brussels, and explain to them the potential detriment of these blacklists not only to us, but to the banking sector across Europe. For instance, if Mauritius makes the list, this impacts French institutions,” he said.

“If Panama makes the list, this impacts Spanish institutions. I think it also makes sense to engage other countries… The ACP represents many developing countries and has formal trade agreements with the EU. I would suggest we do this now, rather than later, or we’ll find ourselves scrambling yet again.”

Minister of State for Finance Senator Kwasi Thompson last month said the government is committed to the development of a more equitable tax system.

A comprehensive study on the country’s tax system was a recommendation of the Economic Recovery Committee (ERC) in October.

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