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British Virgin Islands Budget Focuses On Financial Services' Future

by Mike Godfrey, Tax-News.com, Washington

23 March 2018


The British Virgin Islands has maintained its low tax credentials with no new taxes announced in its 2018 Budget.

Premier and Minister of Finance Orlando Smith said the Budget, the seventh since his tenure as Minister of Finance, had proved to be the most difficult because of the hurricanes that buffeted the territory last year.

Smith said, while the territory's financial services industry was largely unharmed by last year's natural disasters, significant challenges remained in the form of the European Union's campaign to list countries that are regarded as non-cooperative tax jurisdictions. Smith also highlighted pressures coming from within the UK Parliament for the British Virgin Islands to make its register of companies public.

Smith said these two issues, by themselves, have the potential to significantly undermine the territory's economy, the tax base on which central government depends, and the livelihoods of hundreds of people whose employment is in one way or the other connected to the financial services sector.

He said the territory faced a stark choice of whether to continue to pursue the current financial services model or to take action to make the financial services sector less vulnerable to outside attacks by wealthier nations.

Looking ahead, Smith emphasized the importance of tourism and financial services, which he described as the twin pillars on which the territory's economy is built. He said investment in tourism is critical in rebuilding the industry following last year's hurricanes, and said he wants to see the British Virgin Islands transition to a jurisdiction offering a wider suite of financial products with greater economic substance.

TAGS: Finance | tax | investment | financial services | budget | Virgin Islands | British Virgin Islands | services | Europe

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