Bahamas cooperating in tax matters

NASSAU, Bahamas – The Bahamas is amending its Criminal Justice (International Cooperation) Act, 2000 in order to facilitate effective exchange of information in tax matters.

Deputy Prime Minister and Minister of Foreign Affairs, Attorney General and Minister of Legal Affairs, the Hon Brent Symonette opened debate on the amendment in the House of Assembly, October 15.

The amendment enables The Bahamas to provide assistance to countries for requests which relate exclusively to fiscal offences.

“This change to the law of The Bahamas is in line with prevailing international standards,” Mr Symonette said.

Hon Brent Symonette

Under the Act, The Bahamas provides assistance in criminal matters to countries with which it does not have a treaty to provide mutual legal assistance.

The mutual legal assistance treaties are incorporated into Bahamian laws pursuant to the Mutual Legal Assistance (Criminal Matters) Act, Chapter 98.

The Bahamas has negotiated mutual legal assistance treaties with the United States of America, executed June and August 1987; the United Kingdom, executed June 1988; and Canada, executed March 1990.

The Act was brought into existence in 2000 in response to the “blacklisting” of The Bahamas by the Financial Action Task Force.

“It is one of the most important tools that The Bahamas has available in its arsenal in the global fight against money laundering, narcotics trafficking, and the financing of terrorism,” Mr. Symonette said.

Under the Act, the Attorney General is designated as the authority to receive requests, which emanate from a Court or Tribunal exercising criminal jurisdiction, or a prosecuting Authority, or any other authority which appears to him to have the function of making requests of this nature.

The Court, Tribunal or Authority should ensure that an offence under the law of its country has been committed or that there are reasonable grounds for suspecting that an offence has been committed.

“The Bahamas has always held in the highest regard the international legal principles of comity and cooperation,” said Mr Symonette. “Thus, The Bahamas is now seeking to extend the scope of the Criminal Justice (International Cooperation) Act, to provide for assistance to be granted to foreign countries in tax matters.”

There has been a shift from the traditional approach towards the assistance in the collection of taxes, he said.

In common law countries the general principle of international tax law was that a country was not obligated to assist another country in the collection or enforcement of its taxes.

“There has been pressure from international organisations, namely the Organisation for Economic Cooperation and Development (OECD), for offshore countries to increase the transparency in tax structures, facilitate requests for information on tax matters, and assist countries in tax enforcement initiatives,” Mr. Symonette said.

In March 2002, The Bahamas made a commitment to improve the transparency of its tax and regulatory systems and to establish effective exchange of information for tax matters with the OECD by December 31, 2005.

The Bahamas has a Tax Information Exchange Agreement (TIEA) with the United States of America, that provides for the exchange of information in tax matters in line with OECD standards.

At the recent G20 Summit held in April this year in London, many offshore countries including The Bahamas were put on a “grey list” as jurisdictions, which committed to the internationally agreed tax standard, but have not yet substantially implemented that standard.

“The amendment to the Criminal Justice (International Cooperation) Act to remove the restriction of The Bahamas not being able to provide assistance in requests relating to criminal tax fiscal matters is therefore a necessary step to achieving the goal of effective exchange of information in tax matters,” Mr. Symonette said.

“The Government is committed to implementing the standards of transparency and information exchange in tax matters as developed by the OECD, and providing the fullest measure of cooperation in requests relating to tax matters,” he said.

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