Ministry Of Finance Statement: European Union Removes The Bahamas From Tax Watchlist – Mondaq News Alerts

Posted: February 21, 2020 at 8:45 pm

21 February 2020

Bahamas Financial Services Board

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'The Bahamas' financial services industry isstable and governed by a sound regulatoryregime'

The European Union's Economic and Financial Affairs Councilcompletely removed The Bahamas from its List of Non-CooperativeJurisdictions for Tax Purposes, at their meeting in Brussels today.In a statement this morning, the EU confirmed that The Bahamas hasimplemented the necessary reforms to meet the EU criteria on taxgovernance and cooperation on tax matters. The Government welcomesthis decision and the positive impact it should have on growth toinvestor confidence in the industry.

In March 2019, The Bahamas was placed on the EU's Annex II"the greylist". While different from the more seriousAnnex I "the blacklist" of the EU List of Non-CooperativeJurisdiction for Tax Purposes, The Bahamas was still subject toongoing monitoring by the EU with respect to the implementation ofeconomic substance requirements. With today's move, The Bahamashas addressed all of the concerns on economic substance, removal ofpreferential exemptions and automatic exchange of taxinformation.

"This news of our removal from the EU list affirms that TheBahamas takes its position as a global financial center veryseriously. Coming off this list was not an easy process. We engagedmany stakeholders and executed a comprehensive strategy to not onlyaddress the EU's concerns but also to defend the jurisdictionagainst recent attacks on the legitimacy of our financial servicesbusiness," said Deputy Prime Minister and Minister of FinanceK. Peter Turnquest.

Over the past year, the Government's team of technicaladvisors has had several meetings with the EU's Code of ConductGroup to engage in dialogue on the integrity of The Bahamas'tax governance measures. Most of the discussions centered on theintroduction of economic substance requirements for InvestmentFunds.

"The Bahamas has worked diligently to demonstrate itscommitment at the highest political level to internationalstandards on information exchange, tackling harmful tax practicesand dismantling artificial tax structures. On behalf of theGovernment, I thank the staff, agencies and industry stakeholdersthat worked so hard to achieve this result. Your support,encouragement and technical skills have been invaluable in thisprocess and prove once again, we can rise to any challenge,"said Minister Turnquest.

"All of our critics should see that the EU's statementstoday clearly counters the view that The Bahamas is not doing itspart in the global effort to stop financial crimes such as taxevasion and money laundering," he said.

The positive evaluation of The Bahamas by the EU sends a strongsignal to the international community that The Bahamas'financial services industry is stable and governed by a soundregulatory regime. The Government will continue to promoteengagement with all stakeholders on these issues and will take theappropriate measures to ensure that The Bahamas adheres tointernational best practices and remains the preferred jurisdictionof choice for financial services in the region.

Source: Central Communications Unit, Ministry of FinanceDate: February 18, 2020Contact: MOFcomms@bahamas.gov.bs

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