Monday, April 20, 2009Bahamas Lobbies U.S. On Tax Bill

KRYSTEL ROLLEBahamas PM lobbies U.S. On Tax Bill

Amid ongoing concerns that The Bahamas could be targeted in a crackdown on so-called tax havens, Prime Minister Hubert Ingraham revealed over the weekend that he previously wrote to a powerful U.S. congressman expressing this country's position that it ought not be named in a stop taxation abuse bill.

Ingraham said he wrote to Charles Rangel, chairman of the House Ways and Means Committee, and also wrote on behalf of CARICOM at the community's request.

"I think he gave us sufficient assurances about the bill to cause most of our members to be comfortable," said Ingraham, speaking from Trinidad and Tobago.

He added he does not expect The Bahamas to be named in the legislation.

At the 5th Summit of the Americas in Port-of-Spain on Saturday, leaders of the Caribbean Community (CARICOM) met with members of the U.S. House of Representatives Financial Services Committee and a Congressional delegation led by Congressman Rangel and Chairman of the Western Hemisphere Subcommittee Eliot Engel, on the United States' stop taxation abuse initiative.

It was developed in a bid to prevent Americans from using offshore jurisdictions to avoid paying taxes owed to the U.S. government.

Last month U.S. Senator Carl Levin introduced in the U.S Senate a strengthened Stop Tax Haven Abuse Bill, which lists The Bahamas as one of 34 secrecy jurisdictions.

Around that time, U.S. Treasury Secretary Timothy Geithner testified before the Ways and Means Committee of the U.S. House of Representatives and renewed U.S. President Barack Obama's support of a crackdown on tax havens.

Geithner said the Obama administration is committed to putting in place an "ambitious" plan to up the heat on U.S. companies that use secrecy jurisdictions to evade taxes.

According to Prime Minister Ingraham, the stop taxation abuse initiative is "misguided" as it relates to The Bahamas.

"The U.S. congressmen were not able to provide justification for [The Bahamas being named]. There is no justification for the Americans to put The Bahamas in a stop taxation (abuse) bill. The facts do not square with that. We expect therefore that at the end of the day, our name will not appear in any such legislation," the prime minister said.

Ingraham added that there will be further discussions with Congress. He reiterated that The Bahamas has cooperated fully with the United States on tax issues.

"We have a tax information exchange agreement with them, the Treasury Department and the Internal Revenue Service (IRS) would all certify that all requests made in The Bahamas have been responded to appropriately," he said.

The Bahamas is facing a growing threat nearly 10 years after it was blacklisted by The Organization for Economic Cooperation and Development (OECD). That 2000 blacklisting triggered the passage of a compendium of legislation designed to strengthen the country's regulatory framework, and support its fight against money laundering and other crimes. The country signed a tax information exchange agreement with the United States in January 2002.

Earlier this month, The Bahamas was 'gray listed' by the OECD, which named it on a list of 38 jurisdictions it says have failed to substantially implement the internationally agreed tax standard.

Ingraham said in Trinidad and Tobago that negotiations on a tax information exchange agreement with Canada and other countries are ongoing.

The prime minister and his delegation returned to the country last night

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