The Tribune

By EARYEL BOWLEG

Tribune Staff Reporter

ebowleg@tribunemedia.net

DESPITE the notion that Caribbean countries with competitive tax regimes are robbing European countries of revenue, Foreign Affairs Minister Fred Mitchell said the evidence shows the opposite of this is true.

Mr Mitchell addressed the 39th conference of the Economic Commission on Latin America and the Caribbean (ECLAC) in Buenos Aires, Argentina yesterday.

The Fox Hill MP spoke about the tax competition while he said the issue of climate change is “front and centre” for The Bahamas citing the impact of Hurricane Dorian such as the cost in damage and lives lost.

“And the question is, are we sufficiently serious when we come to COP27, to provide the funding for loss and damage, and to provide monies for us to be able to adapt, and to mitigate the effects of climate change. So far, the money has not been present or put there for this to happen,” he said.

“And secondly, we keep arguing for this multi-dimensional vulnerability index, because it’s been said time and again, that gross national product per capita does not adequately point out the vulnerabilities of our countries. So when we go to COP27, we will be again arguing on loss and damage, and arguing that we need to move to a multidimensional vulnerability in that in our region, we are suffering the instability of Haiti.”

He highlighted there is an ongoing concern about the instability and humanitarian needs of Haiti and The Bahamas along with its CARICOM member states have decided to work towards some kind of solution for this.

“I understand that there is a resolution which is potentially to be crafted and go through the United Nations Security Council shortly to be able to provide that support. And I hope that every country here in this room will support those efforts at the United Nations Security Council to support trying to do what we can to restore order and progress in the Haitian Republic,” he said.

Mr Mitchell expressed concerns regarding the views on international tax matters.

He added: “The Bahamas, though, is concerned that there is an asymmetry, and I hope - I listened yesterday to the representative of the OECD. And I’m informed that after the foreign ministers speak, we will hear from the European Union, but there’s an asymmetry which exists between CARICOM countries and the EU with regard to their view of what is happening on international (tax) matters.”

“And I say this because the bottom line is poverty and uplifting people from poverty in our societies and 10-20 years ago, the mantra across the hemisphere and region was international competition and trade. And international competition and trade meant that we could use whatever assets we had to lower the cost of doing business and this included tax competition.

“Suddenly, the EU has found religion on this point, and tax competition has now become somehow immoral. The next thing we know is the rules start changing - changing unilaterally. And these mandates are being imposed upon CARICOM countries. And every time you meet the last goalpost, the goalposts have shifted again, again unilaterally. And what they’re saying is that these societies, the Caribbean societies that are engaged in this tax competition, are robbing the European countries of revenue.”

He said the evidence is that these countries are not robbing these European societies of any significant sums.

“When the evidence is, in fact, just the opposite, first of all, the taxes that are being lost, and the money laundering and the allegations that there’s evasion. We know that in developed countries that much more money passes through those systems than can ever pass through the systems in the CARICOM countries. So that’s the first thing,” the minister stated.

“Secondly, the evidence is that people park their money in our societies, but the money goes right back, when it’s cashed into the developed societies. And the one that comes to mind is Cameron’s father, who used to be the prime minister of Britain, discovered that his father had put assets in The Bahamas. When he discovered it, the assets were cashed in and returned to the UK. So the evidence is that the societies are not robbing these European societies of any significant sums - at least that’s my view of it.

“But what I do know is that as a result of changing these people in The Bahamas, who had good incomes as a result of this tax competition, which is what I choose to call it, have now lost those incomes and are now scraping for jobs in our countries in a place where they had comfortable middle class incomes.”

Mr Mitchell said he took offence to a statement that was attributed to a spokesperson for Oxfam, an “anti-poverty organisation and anti-hunger organisation” in the UK, in which it was said after the latest blacklisting of The Bahamas the country deserved what it got.

“And I thought to myself how can an organisation that knows what the net effect of the policies, these unilateral decisions are going to be on the society in The Bahamas and throughout the Caribbean? How can someone justly make such a statement is in fact outrageous and perhaps they need to go and revisit that statement. Because it is really causing dislocations in The Bahamas and across the Caribbean region.”