US “Stop Tax Haven Abuse Act” Names & Targets Barbados – Has David Thompson Actually Read The Legislation?

BARBADOS’ Prime Minister David Thompson said he does not believe that Legislation tabled recently in the United States Congress to deal with offshore tax havens is targeting jurisdictions like Barbados…

“I want to say that despite the strong feelings about that piece of legislation, it did not seem to us that it was aimed at jurisdictions like Barbados,” the Prime Minister told the function organised by Invest Barbados, this country’s leading business promotion agency…

… from the Barbados Advocate article Barbados Is Safe!

Internal Revenue Service Barbados

U.S. Internal Revenue Service Names Barbados As A “Secrecy Jurisdiction”

According to David Thompson, Barbadians have nothing to worry about when it comes to the new American “Stop Tax Haven Abuse Act”. You see, the Prime Minister “feels” that the legislation is not aimed at jurisdictions like Barbados.

Perhaps Prime Minister Thompson had better read the American legislation and speak with the authors — who originally included a Senator named Barack Obama — because unlike David Thompson, those authors and the Internal Revenue Service “feel” that Barbados is an offshore secrecy jurisdiction and tax haven and they have said so in writing.

Senator Carl Levin Tax HavenYou don’t have to believe me, or Prime Minister Thompson. Just go to the website of President Obama’s partner pushing the legislation, United States Senator Carl Levin, and download it for yourself. (US Senator Carl Levin: Senate, House Members Introduce Stop Tax Haven Abuse Act – and here is his website: Senator Carl Levin Website)

The act includes a list of 34 jurisdictions identified in Internal Revenue court proceedings and Barbados is number five on that list of targeted jurisdictions. Again, you don’t have to believe me, you can read it for yourself (and frankly you won’t read it in any Barbados news media) Here is an excerpt…

‘‘(E) INITIAL LIST OF OFFSHORE SECRECY JURISDICTIONS.

For purposes of this paragraph, each of the following foreign jurisdictions, which have been previously and publicly identified by the Internal Revenue Service as secrecy jurisdictions in Federal court proceedings, shall be deemed listed by the Secretary as an offshore secrecy jurisdiction unless delisted by the Secretary under subparagraph (F)(ii):

(i) Anguilla.
(ii) Antigua and Barbuda.
(iii) Aruba.
(iv) Bahamas.
(v) Barbados.
(vi) Belize.
(vii) Bermuda.
(viii) British Virgin Islands.
(ix) Cayman Islands… (and 25 other jurisdictions)”

… From the (PDF) “Stop Tax Haven Abuse Act”

Why Should The United States Trust Barbados?

If you take emotion, patriotism and sheer will to survive out of your normal Bajan reaction to the US anti-tax haven legislation, you must admit that Barbados neatly fits the definition of both a “secrecy jurisdiction” and a “tax haven”. As well as the United States, both Canada and the Organisation for Economic Co-operation and Development (OECD) have named Barbados as a recognised “tax haven”.

What defines a “tax haven” and “secrecy jurisdiction”?  If you read the US and Canadian government reports and other materials freely available on the internet, you’ll see that a big part of that definition concerns what a “tax haven” is MISSING in terms of controls, oversight, transparency and rule of law. These missing structures allow what President Obama defines as “tax haven abuse”.

How About Barbados’ Controls, Oversight, Transparency and Rule of Law?

Ahhhh…. not so good….

Successive Barbados governments have failed to implement even the most basic controls and oversight over offshore corporations and government officials, so why should the United States remove our country from the list of secrecy jurisdictions and tax havens targeted by the new legislation?

Let’s look at some of the mitigating qualities for “good” offshore jurisdictions that might make Senator Levin and his colleagues reconsider placing Barbados on the list…

* Transparency of operations through Freedom of Information Legislation?

(NO! – Barbados doesn’t have FOI legislation or a culture of transparency and accountability. We were promised FOI, but it never came. As for transparency, Barbados does not hold inquests into deaths even when an entire family is wiped out . The elites are protected at all costs. )

* Oversight over Corporations?

(NO! – Barbados has a record of failing to provide sufficient oversight and accountability when it comes to corporations. Corporations are allowed to get away with refusing to file financial information as required by law. When the current Prime Minister was a practicing lawyer, some of his big corporate clients like CLICO failed to file required information and he didn’t care. Not to mention the fact that many government-owned corporations have failed to account as per law. Heck, even the Chief Justice of Barbados doesn’t file proper corporate documents for 13 years and gets away with it!)

* Integrity Legislation, Conflict of Interest Laws for Government Officials?

bribery.jpg(NO! Barbados has no integrity legislation, conflicts of interest rules or a Ministerial Code! The current DLP Government promised to implement all this within the first 100 days, but that was almost a year and a half ago. Unbelievably, in Barbados it is still legal for a government official (elected or appointed) to issue a government contract to a company owned by the government official or their immediate family! See: Thanks To Prime Minister David Thompson, Barbados Government Officials Can Still Use Their Office For Personal Profit)

* Corporate Records Requirements?

(NO! Barbados has consistently failed to compel Barbados corporations to adhere to the law. It is not unusual for records to go missing – even government records – if it is convenient to some of the elites. Even government-owned corporations don’t file records as per the law! Here are some examples of failed oversight regarding corporate records keeping5: Gymnasium Limited, GEMS Hotels, CGI Consumers’ Guarantee Insurance Company, and CLICO for a start.

* Requirement To List Beneficial Shareholders of Corporations?

(NO! According to the International Monetary Fund Country Report No. 09/19, (link shows all IMF reports) Barbados law does not require the disclosure of beneficial shareholders of corporations. While the Registrar of Companies maintains a register with information on directors and registered offices of companies, there is no legislative requirement to disclose beneficial ownership information. Many Barbados foreigner-owned offshore corporations are “fronted” by Bajans, but the corporate records are kept in another jurisdiction, while the money flows to another jurisdiction like Panama or the Caymans. The true owners of the corporations remain hidden by Barbados law!

IMF Barbados Corruption

The IMF report also talks about corruption and bribery and other serious offences not being illegal…

“Barbados has criminalized money laundering (ML) broadly in compliance with international standards. However, while the definition of unlawful activity allows for a wide array of serious predicate offenses, human trafficking, corruption and bribery are not totally consistent with the requirements of the Palermo Convention.”

See the – PDF – IMF Country Report No. 09/19, January 2009)

* Rule of Law?

(NO! Successive Barbados governments have consistently shown that the “Rule of Law” means “We enforce laws when convenient to do so for our purpose and agenda.” Prime Minister Thompson declared that previous government officials stashed millions in foreign bank accounts, yet no action was taken against them. Rapists with money are allowed to buy their way out of criminal charges. THAT says everything about how Barbados views the wider societal importance of Rule of Law.)

* Effective Anti-Money Laundering Enforcement?

(NO! First, as the IMF report above points out, Barbados lacks the laws necessary to curtail bribery and conflicts of interest. Second, as the IMF report points out – the anti-money laundering authorities in Barbados haven’t really done anything! Left unsaid is that the Barbados Anti-Money Laundering Authority hasn’t really done anything, but the government took the international funding anyway. Naturally… 🙂

The most telling indicator of how the Government of Barbados views money-laundering, tax evasion and other international financial shenanigans though, is the fact that our country had to admit that the Barbados Anti-Money Laundering Authority Acted Illegally and Without Authority For Two Years.

The government only fixed things up retroactively after the story broke on a Barbados blog! – See Keltruth Corp’s article Does the Barbados Anti-Money Laundering Authority (AMLA) Really Exist?)

Lack Of ITAL (Integrity, Transparency & Accountability Legislation) Is A Root Cause Of American Legislation Targeting Barbados

PM Thompson Lied About ITAL

PM Thompson Lied About ITAL

Successive Barbados governments, including the current DLP Thompson government, have deliberately refused to implement integrity reforms because doing so would limit their ability to profit from their public offices. Period.

By their actions and inactions, Owen Arthur, Mia Mottley, David Thompson and dozens of other political elites placed Barbados squarely in the target sights of the Obama administration’s “Stop Tax Haven Abuse Act”.

How fitting that if Barbados finally does implement ITAL, it will be because the corrupt politicians were finally dragged kicking and screaming to do something decent for the country – by the first black President of the United States of America.

Further Reading

Barbados is safe!

5/8/2009 (Barbados Advocate)

By Jewel Brathwaite

BARBADOS’ Prime Minister David Thompson said he does not believe that Legislation tabled recently in the United States Congress to deal with offshore tax havens is targeting jurisdictions like Barbados.

Speaking at a function Wednesday night at Ilaro Court – his official residence – the Prime Minister told a group of business representatives from this country’s International Business and financial sector, as well as Government officials, that Barbados has been co-operating with countries to ensure they benefit from the sector.

The measure known as the Stop Tax Haven Abuse Act was tabled last month by US Senator, Carl Levin, a Democrat from Michigan, to restrict the use of offshore tax havens and abusive tax to inappropriately avoid Federal taxation. Barbados is not a tax haven.

“I want to say that despite the strong feelings about that piece of legislation, it did not seem to us that it was aimed at jurisdictions like Barbados,” the Prime Minister told the function organised by Invest Barbados, this country’s leading business promotion agency.

According to the Prime Minister, this country “co-operates in providing information and working with countries to ensure we share mutual benefits from the international business sector.”

He recalled having held discussions about the proposed legislation with United States President Barack Obama and other American officials at the recent Summit of the Americas in Port of Spain. Thompson said that the American message was very clear.

He pointed out that their concern was that all persons who should be paying taxes in the United States of America will be paying them. “That is their position and they will do everything to ensure the taxes are paid and collected,” he said.

The Prime Minister said he considered this “a reasonable and fair position on the part of the USA, and it is entitled to have that position and it is not something we as a sovereign nation can question”.

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37 Comments

Filed under Barack Obama, Barbados, Corruption, Crime & Law, Ethics, Freedom Of Information, Offshore Investments, Political Corruption, Politics, Politics & Corruption

37 responses to “US “Stop Tax Haven Abuse Act” Names & Targets Barbados – Has David Thompson Actually Read The Legislation?

  1. kiki

    Barbados is out of US jurisdiction / restriction every body knew that. When legislation changes clients can opt in or opt out.

  2. TheNickster

    One one hand they will talk about how desperate the foreign income is needed, quality of living and other rhetorical nonsense, then create environments that encourage these same “foreign investors” to dance around these regulations.

  3. Bajan Nobility

    Thompson knows what our offshore banking industry is all about. He is doing his best to spin it but to no avail. The “anti-terrorist funding” laws are mostly being used to control tax avoidance and hunt down tax-criminals.

    I don’t subscribe to the conspiracy theories about the USA attacked the twin towers etc., but I do recognize that the US government is taking advantage of the attack to do whatever it wants.

  4. transparency

    And then there was the recent
    Town Hall meeting about a big development around St Davids Church / Staple Grove area for 450 houses but the developer declined
    to identify himself and sent a consultant to make the presentation even though Town Country and the public was present.

    What kind of country can allow a presentation to be made to a Town Hall meeting and the public on such an important project without knowing all the owners ( including beneficial ) and consultants and hangers on getting a fee?

  5. balderdash

    What an excellent news article BFP. I did not realise that Barbados was listed in the legislation. I thought it was a general threat to us, but it is a specific targeted threat against our economy.

    The Barbados news organisations have not communicated this. I have not read anywhere that Barbados is specifically mentioned in Obama’s legislation. THANK YOU!

  6. Jason

    Barbados is listed in the US legislation. Not good.

    Why the F**K do I have to read this on a blog and not in the regular Bajan news media?

  7. Brother Sam

    kiki, if you think for one second that U.S. Legislation can not affect Barbados, think again. Do you really think that if the U.S. financial regulatory body told Thompie that they want a look at the off-shore banking accounts that he would say no? Barbados depends too much on U.S. loans and concessions to even think of witholding this information. Just ask Mexico about “jurisdiction” when the U.S. DEA is making arrests in Mexico.

  8. cq8

    I agree with Jason. Excellent piece that should have been in the nation or advocate.

  9. Chicago

    As we say up here, Thompson look like a “deer caught in the headlights”.

    He doesn’t know what to do so he is making nice. WRONG!!!

    We need our government to embrace whateverthefukitistheUSAwants.

    NOW.

  10. passin thru

    No worries. If the USA dumps Barbados over this we should kick their CIA drug airplanes out of the country. Obama will never pull the trigger on Barbados.

  11. Donald Duck, Esq

    Readers need to know that Canada just signed an exchange of information agreement with Bermuda. This now puts Bermuda on par with Barbados as regards how canada will treat investments in these countries by their citizens. This will provide more competition for Barbados and will hopefully make the government realise that they have to do more for this sector

  12. kiki

    The list of proscribed territories is standard tax legislation. European / American directives did not include Caribbean islands which will be included in the future now.

  13. West Side Davie

    The PM’s response reminds me of an ostrich sticking the head in the sand. We need some leadership here, not some Polly Anna saying everything is Okay. Barbados is on “the list”. What is the government’s plan for dealing with that?

  14. reality check

    The very things that BFP has been preaching from the beginning such as Rule of Law, ITAL, FOI is what is expected from all OECD countries who want to do more business with the world.

    Stop dragging your feet Barbados. These countries are looking for substance not rhetoric and corruption as usual.

    Embrace the new reality and you may be looked on with favour and some help.

  15. No Name

    BFP
    Excellent article!

  16. reluctant nonbeliever

    Hey BFP

    Which one of you wrote and researched this article?

    It’s superb.

    Puts the mainstream media to shame.

    Incidentally (slightly off topic):

    have you guys been following the scandal over UK politicians’ expenses?

    I guess the moral is that politicians all over the world are disgusting, corrupt and power-mad pigs at the trough…

  17. Just Wondering

    How come it seems that when the Democrats are in power in Washington that small and poor jurisdictions in the Caribbean are the first to get the shaft? Aren’t they suppose to be the party for the little people? I seem to remember that it was the Clinton Administration (first black president, re: Mayo Angelou) who screwed the banana farmers in the Windwards, not to mention the cold water they threw on the offshore banking sector in Barbados and elsewhere. Now, the second black president seems to be singing from the same hymnal or something.

  18. Sargeant

    To answer part of your question :In a nutshell the Republicans are for the creation of personal wealth. If you can make it and avoid paying Uncle Sam taxes and pass it on to you heirs that’s fine for the GOP. That’s why we didn’t hear about reining in of Tax Shelters during the Reagan or Bush 1 &11 Administrations but we heard about them during the Clinton era and now we will hear about them during Obama’s term.

    One other thing the people and corporations who benefit from Tax Shelters or have their assets in these offshore havens are more often than not significant contributors to Republican coffers.

  19. kiki

    not all clients are corrupt, but it raises the question why there are large amounts in some accounts when the rest of the world is short right now

  20. Mike Ashby

    I read the above article with lots of apprehension. I have grown accustom to doing this whenever America set out to use the UN, IMF, OECD, G8(20), World Bank or any other American or European dictated body to accuse small developing countries of not playing fare. In my opinion, this is America crying about not getting a bigger piece of the pie. What is really happening is, like with the Lomé agreement on sugar and bananas, America wants the whole pie.

    This is the first short coming of the Obama administration, rather than prosecute the thieves and criminals that systematically bankrupted the American economy; he prefers to accuse smaller countries permitting Americans to get away from paying the IRS. How much money is he talking about? Compare it to how much is hidden in Europe and the Far East, and compare that with the amount that is uncollected in America.

    If the Obama administration is willing to jointly, and in the sprite of cooperation and collaboration encourage countries like Barbados to review their laws as they apply to the offshore sector, then do that, otherwise, they should spend the time correcting the flaws in their domestic policies. They are no longer in the position to dictate to other nations.

  21. RRRicky

    This is about a number of things coming together:

    1/ the fact that the US treasury is empty

    2/ politicians of both parties would rather tax individuals and give the money to large corporations (bailouts)

    3/ Computerization has given the Internal Revenue Service tools they never had before.

    4/ 9/11 has provided the excuse and reason they needed to improve and implement the tools.

    5/ 9/11 made the populous accept the restrictions upon their individual rights and freedoms.

    6/ Obama has power that no President has ever had before in a combination of technical ability to find offshore money and a political majority in both houses to let him do it.

    7/ Obama is exercising that power to further the government’s control over individuals and countries.

    The Swiss are cowering in fear and that gives you some idea of how bad the situation is. They didn’t do that even when Hitler and the Nazis were on their doorstep, but they are doing so now. I don’t know what the solution is, but putting on a happy smile like Thompson is doing doesn’t cut it.

  22. Red Lake Lassie

    Let me add my “excellent article” to those above, with the exception of the sentence: “Unbelievably, in Barbados it is still legal for a government official (elected or appointed) to issue a government contract to a company owned by the government official or their immediate family!”

    Take out the word “Unbelievably” and it will be perfect.

    Guvment people been awarding contracts to they family since 1966 and before and I BELIEVE IT!!!

    🙂

  23. stealing

    “The Swiss are cowering in fear”

    only when it comes to 52,000 US citizens who are hiding monies to avoid paying taxes on their world income.

    There are enough ways to manage taxes in an effective manner than tolerate it being evaded in the first instance.

    The Swiss have been living off the avails of other countries misery for decades. It is said that up to 40% of all monies that go into helping Africa, go into Swiss Bank accounts. Once again the little guy gets no benefit of trickle down economics.

    http://www.telegraph.co.uk/comment/personal-view/3639690/Feed-the-world…-not-a-Swiss-bank.html

    http://www.africanexecutive.com/modules/magazine/articles.php?article=4158&magazine=218

  24. WildyCoyte.

    That’s right David,keep those gullible Bajans living a million miles from reality while we line our pockets and hope they continue with their slumber,between the government and the press it will be a battle to see when the mess hits the fan and the people wake up and are looking for victims to castrate.

  25. skinteeth

    And for this week folks,the new reality ,poopycock show is the the statue of Nelson. Last week , we had those illegals ( but only the dark ones) who are everything that is wrong in our beloved land and ,for this week, we have a throw back to an old white relic (who matters none to the outside world) but is now thrown out of Hero’s Park. Could next week be a revisiting of BNB shares , so the patriotic embers can keep burning or something along the line of ” nobody will hold the government or the people of Barbados for ransom”. Stay tune

  26. Rumplestilskin

    This legislation is a detraction from the real economic issues facing the US.

    The auto industry is still facing collapse, the markets are not stable because the underlying economy cannot and will not be stable for a while.

    On top of this, billions are spent monthly on the Middle East confrontation, which is a further guarantee that any economic re-development will be further delayed.

    So, the few hundred million from suspected offshore bank accounts are being chased, while the economy is bleeding billions every month from an inappropriate Middle East strategy, that is proving to be unsuccessful, that will be further drawn out by the lack of properly designed strategic action.

    Which companies have made billions from the Iraq war?

    As P.T.Barnum said, there is one born every day.

    Smoke and mirrors.

    Peace & Live Strong

  27. Realtor

    For President Obama America is his priority. Unemployment and social services follow. The people of the Caribbean would be foolish to expect that their interest would be protected in the scheme of things.

    Home drums beat first remember that. “America is the UNITED STATES OF AMERICA”. On the other hand the Caribbean is a group of different states in the Caribbean all surrounded by the Caribbean sea.

    See the difference.

  28. kiki

    Criminal and multi-national organisations operating cross-border can easily move their banking elsewhere or find loopholes for new legislation, leaving only legitimate individuals left to comply with new tax laws. Another problem is when dirty money is removed from the markets there is/will be a global economic crash and nobody can invest their money.

    It’s time to stop the dependance and fixation on greed and money and concentrate on positive social improvements for the whole community.
    Third world countries are rich in resources but cannot compete with western economies due to the discrepancies in the cost of living / standard of life.

  29. kiki

    .. In other words, when you change tax laws, there is less profit from businesses and less income tax received, and the authorities have shot themselves in the foot once again.

  30. Juris

    You need to re-read the legislation, BFP. Thompson said it was not aimed at countries like Barbados, not that Barbados was not named. The list of countries is a preliminary list that can be subtracted from or added to depending on their secrecy laws. Barbados has none…

  31. Juris a Joker

    Ha ha,

    I read the legislation at the link that BFP provide in the story. I read what Thompson say in the Advocate and the Nation and there was no words by him or the reporter saying that Barbados was named! It was like Thompson and the papers are hiding the truth from the peoples.

    Look what you try to say now. LOOK at what you say: “Thompson said it was not aimed at countries like Barbados, not that Barbados was not named.”

    What a clever person Thompson is to LIE without being able to be caught in the lie! Then the newspapers say “Barbados is not a tax haven” without saying that two countries USA and Canada say we are! No discussion about what “tax haven” means.

    Keep the peoples dumb is Thompson’s motto and the newspapers too.

    Nothing in this article is untrue. I checked the legislation and I read the newspapers.

    This article is truth. Secrecy? Barbados has the best secrecy of all for offshore corporations because the beneficial shareholders do not have to be registered!!!!!!!!!!!!!!!!

    There is a reason why that is and that reason is secrecy. True too is that on the Senator’s website who did the law there is a story of tax haven that is Barbados where some US companyh was able to lend money to itself and then borrow it again and not pay taxes and Obama says this is a tax haven and it is Barbados.

    HOw you pervert the truth for politics Juris!

    We in big trouble and Thompson “feels” everything is ok and Obama and the Senator don’t mean Barbados. Visit the senator’s website. He mean Barbados an he say so!

  32. reality check

    nice try

    no obligation to disclose beneficial and all ownership is one and the same thing as secrecy laws.

    The net result is that there is no real transparency or accountability and in Barbados this is a way of life.

  33. tekaview

    you only can read it here because:
    1. our press is largely “controlled” in what they are “allowed” to print. Bad news hurts!
    2. the majority of our “reporters” only know how to turn on and off a recorder and transcribe, often inaccurately, what has been said.
    3. the majority of our “reporters” evidently lack the ability to research and develop a story using professional investigative techniques.
    4 the major circulation paper is primarily concerned with just that – circulation! That’s what pays the bills for the big cars they drive and life-styles their executives live.
    What a disaster in which we find ourselves!
    Oh well, elections again in just under four years, more ‘change’ will be promised!

  34. tekaview

    Wonder too why there is similarity between the DEMOCRATS and the DEMOCRATIC Labour Party! The DLP is for “the little man”, so they say, yet whenever said and done who is get hurt?
    You do not build an economy or a country by taxing people and putting Government controls on everything that moves. Too much freedom is dangerous as we have seen, but too little freedom means nothing happens.
    Obama is on the wrong wicket and DT does not know where the game is being played.
    Send in the clowns.

  35. Mike Ashby

    Barbadians have to be more heads-up on this issue and take it more seriously. The main reason is over the last 20 years the local government has shifted its GDP from agri-based/manufacturing ventures to service-based ventures. To do this they created a “system of promises” to promote so-called “foreign Investment”. Included in that “system” is what is now called the “off-shore banking sector”. Well, that sector is responsible for a significant portion of the island’s yearly capital earnings and a significant percentage of the island’s job market.
    While we are able to recognize Obama’s intentions and may disagree with them, the onus is on us to address this problem within the island’s industrial framework as quickly and as efficiently as we can. The US (Obama and Levin) is just giving us a wake-up call. The measure of our leader’s competence is in what we do as a result.

  36. Pingback: Two Different Messages: Barbados Ambassador To USA Sounds Alarm Over Tax Haven Crackdown – Barbados Prime Minister Says We Shouldn’t Be Concerned « Barbados Free Press

  37. Max

    All are being forced to bow down to the UN, IMF and OECD, World Bank, they are the ones who now control the entire world through blackmail and blacklisting enslavement. Supported by the EU and the USA.

    Some people think there are no slaves today, what a total lie. The future of people who want to regain some sort of freedom from being enslaved into sin by these genocidal forced tax funding of abortion and bisexual indoctrination countries will have to return to methods of barter and secret societies to protect themselves from the world police state being implemented by these corrupt wicked people.

    In the last few months even Belize sold out as well.