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Bahamas Adapting To New Tax Transparency Landscape

by Jason Gorringe,, London

15 April 2013

The Bahamas' Minister for Financial Services Ryan Pinder has said that the local financial services industry must be prepared to accept and adapt to automatic information exchange under the Foreign Account Tax Compliance Act, and similar regimes, as it becomes the "new normal."

Speaking at the "Complying with FATCA" one-day regional conference on April 9, 2013, Pinder pointed out that FATCA is shaping up to be the "most significant matter facing the international financial services industry today."

“The global paradigm is shifting to an expectation of transparency globally,” Pinder said. “We have been witnessing this evolution over the last 15 years from when legislative changes were made for anti-money laundering purpose since the early 2000s, to the implementation of Tax Information Exchange Agreements, to the imposition of Organization for Economic Co-operation and Development and Financial Action Task Force recommendations, and now FATCA."

“We, however, have developed a significant level of local expertise; we must be committed to competing in this new normal. We can be industry leaders.”

Pinders said, in recognizing the importance of the initiative: “We in the Ministry of Financial Services thought it wise, even before engaging the United States, to create a FATCA Task Force representative of some of the most progressive minds in the private sector of our financial services industry."

“This FATCA Advisory Group had the mandate to review FATCA requirements and make recommendations for research and ultimate discussion and negotiation on matters particularly sensitive and relevant to the financial services sector of the Bahamas,” Pinder noted. “It was this FATCA advisory group of private sector representatives who would partner with my Ministry to prepare for the beginning of negotiations on FATCA. Having recognized the areas of FATCA that have particular relevance to our financial services industry, we are prepared to address them," he concluded.

Bahamas' Prime Minister Perry Christie discussed the territory's efforts to adapt to the changing landscape, adding that: “After 80 years of a very successful financial services model, largely bank and trust based, we are re-examining what we do and how we do it."

This will include diversifying the Bahamas' economy, he continued: "As the Minister of Financial Services Ryan Pinder outlined in his 10 year strategy a few months ago, the Bahamas is taking stock and promoting the depth and width of our products and services which include commercial banking, private banking, trust services, capital markets, investment advisory services, e-commerce, insurance, accounting and legal services along with corporate and shipping registries and investment fund administration [as well as] the introduction of arbitration services and yacht and airplane registries and updated Intellectual Property registries.”

TAGS: Foreign Account Tax Compliance Act (FATCA) | investment | Bahamas | mining | interest | commerce | legal services | public sector | Intellectual Property | FATCA | accounting | banking | financial services | capital markets | insurance | offshore | agreements | e-commerce | United States | services | Compliance | Tax

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