‘EU Decision Demonstrates Bermuda’s Position’

[Updated] The Government of Bermuda said they note that the Economic and Financial Affairs Council [ECOFIN] has “reaffirmed Bermuda’s status as a cooperative tax jurisdiction.”

Premier David Burt said, “Once again the EU has recognized Bermuda’s status as a cooperative jurisdiction, despite the interest surrounding a hack on a global law firm and related documents in the public domain.

“The outcome of the ECOFIN decision demonstrates Bermuda’s position as a global leader in international tax transparency.

“Bermuda is not a place to hide money, given its Common Reporting Standard and Country by Country automatic reporting regimes and membership in the OECD Inclusive Framework on Base Erosion & Profit Shifting.

“Any legitimate tax authority can request and receive information from Bermuda, under 100-plus tax-transparency relationships pursuant to the OECD multilateral tax treaty, and more than 40 bilateral Tax Information Exchange Agreements. Bermuda welcomes continued dialogue with the EU Code of Conduct Group and EU Member States.”

The Government’s comments follow after the EU Council approved and published “conclusions containing an EU list of non-cooperative jurisdictions in taxation matters.”

“The jurisdictions that appear on the list are strongly encouraged to make the changes requested of them. Their tax legislation, policies and administrative practices result or may result in a loss of revenues for the EU’s member states,” the Council said.

“Pending such changes, the EU and the member states could apply defensive measures. Including both taxation measures and measures outside the field of taxation, these measures would be aimed at preventing the erosion of the EU member states’ tax bases.”

The “EU list of non-cooperative jurisdictions for tax purposes” includes American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macau, Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, Trinidad and Tobago, Tunisia and the United Arab Emirates.

Update 12.14pm: Bermuda, while not listed as a “non-cooperative jurisdiction, is mentioned once in the 38-page report, with the Council mentioning Bermuda, along with over 45 nations, for other matters. Citing the “existence of tax regimes that facilitate offshore structures which attract profits without real economic activity,” the Council said, “The following jurisdictions are committed to addressing the concerns relating to economic substance by 2018: Bermuda, Cayman Islands, Guernsey, Isle of Man, Jersey and Vanuatu.”

Update 6.11pm: In response to media queries, Premier and Minister of Finance David Burt stated, “Bermuda is a recognized jurisdiction for being transparent and cooperative. As recently as last week, I signed a CbC Reporting Agreement with the United Kingdom, the first Overseas Territory to do so.

“Earlier today, Bermuda was reaffirmed by the EU as a tax transparency leader and a cooperative jurisdiction. Bermuda has committed to continued engagement with the EU and the OECD to maintain Bermuda’s global leadership in this area.”

The 38-page EU ‘Outcome Of Proceedings’ released today follows below [PDF here]:

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