Big move! BVI shares business info to help countries collect tax
For the first time, the BVI’s financial services industry has provided information about some businesses registered here that will help the entities’ resident countries to collect valuable tax from their offshore activities.
Eleven other countries labelled as notorious tax havens have provided similar information to jurisdictions across the world that will now get to collect taxes from offshore assets their citizens own.
They are Anguilla, the Bahamas, Bahrain, Barbados, Bermuda, Cayman Islands, Guernsey, Isle of Man, Jersey, Turks and Caicos Islands, and the United Arab Emirates.
The countries have disclosed this information to meet standards set out by the Organisation for Economic Co-operation and Development (OECD) Forum on Harmful Tax Practices.
This information includes the identity of the entity, its activities, and the ownership chain of entities.
And countries that get the information will now be able to carry out risk assessments and apply their controlled-foreign company, transfer pricing, and other anti-base erosion and profit shifting provision.
For a long time, offshore countries have pushed back against disclosing financial services information because they feared it would prevent clients from doing business with them.
But they have faced major pressure from international tax lobbies in recent years and some jurisdictions have been blacklisted from major markets.
The new disclosures are required for entities located in no or nominally taxed jurisdictions that derive income from geographically mobile activities, such as headquarters, distribution centres, service centres, financing, leasing, fund management, banking, insurance, shipping, holding companies, and provision of intangibles.
The OECD is a powerful economic bloc of 37 countries. Offshore low-tax countries like the BVI have an interest in following standards required by the OECD as pushback could lead to loss of business for these jurisdictions which depend heavily on the financial services industry.
“Today’s first exchanges of information on the previously unknown operations of entities in low tax jurisdictions are good news for tax administrations around the world, as they will now have regular access to information on the activities and income of entities in low tax jurisdictions that are held or controlled by their taxpayers,” said Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration.
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Lol this is not breaking news. The law has been around since about 2019 with a deadline of late last year before an extension.
Well the article says “For the first time, the BVI’s financial services industry has provided information…”.
The law is one thing the actual execution another.
This is a step in the right direction!
Low-tax jurisdictions are great but only if they are sustainable.
The article is wrong.
Information is being shared already for a long time.
That’s even better!
Bad Economy. now you giving your last dollar for the benefit of the UK. They not with us. All What they trying to do is frig us and make us poor.
Very badly misinformed. Financial information has been provided on request for around 20 years. Introduction of FATCA and CRS around 2014/15 provided for automatic exchange of information – even created a new industry sector known as AEoI (automatic exchange of information).
Very true.it’s something global,not just the B.v.i.
Be clear, it’s happening only in those jurisdictions where the EU has some pull.
Every Asian and Russian controlled tax haven is benefitting hugely. The western countries aren’t going to suddenly get to collect taxes, the money will simply move to Tapei and Singapore where they happily ignore the US and EU
good start share the name of local companys that collect tax nhi and social and do not pay up
Can’t the Caribbean do the same?.
Last time I looked we are in the Caribbean.