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China pledges support to Bahamas in tax haven fight
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By CANDIA DAMES ~ Guardian News Editor ~ candia@nasguard.com:

A high-ranking official of the People's Republic of China has pledged his nation's support to The Bahamas as this country and other offshore financial jurisdictions face increasing pressures from powerful countries.

Wu Bangguo, chairman of the Standing Committee of the National People's Congress of the People's Republic of China, made the commitment in the Cabinet Office on Friday. Wu, who was on an official visit, left The Bahamas yesterday.

China is a member of the G-20, which is made up of the finance ministers and central bank governors of the largest and most industrialized nations.

Speaking through an interpreter and in the presence of Prime Minister Hubert Ingraham and his Cabinet, Wu said, "We support the increased management of the international financial institutions and also reform of the international institutions. But what we would like to see is an increase in the representation and the voice of developing countries in the international financial institutions."

Noting that The Bahamas is a center for offshore banking, he said, "We understand that you are very much concerned and interested in the tax haven (issue). At the G-20 Summit we categorically opposed the practice of some developed countries unilaterally incorporating some developing countries into the blacklist of tax havens."

Following the G-20 Summit in London in April, the Organization for Economic Cooperation and Development (OECD) named The Bahamas on a list of 38 jurisdictions that have failed to substantially implement the internationally agreed tax standard. Global leaders also vowed at that time to crack down on so-called tax havens while declaring an end to bank secrecy.

There have been growing concerns that tax havens have substantially contributed to the global economic crisis that is still unraveling.

The OECD progress report in April noted that The Bahamas committed in 2002 to the internationally agreed tax standard, which was developed by the OECD in cooperation with non-OECD countries.

Addressing the issue, Wu said, "We understand that your country would like to have more discussions with the Chinese side on exchange of the taxation intelligence and China adopts a very positive note and attitude on it. We can have exchange of views through diplomatic channels on this front."

Several weeks ago, The Bahamas government announced that it is negotiating tax information exchange agreements (TIEAs) with 14 countries.

The minimum number of TIEAs required by a jurisdiction to satisfy the standard set by the OECD is 12. The government advised that negotiations have commenced with Canada, the United Kingdom, Australia, Spain, Germany, France, Turkey and the Nordic countries (Norway, Sweden, Finland, Denmark, Iceland, Greenland and the Faroe Islands). It also announced it has initiated discussions for agreements on tax information exchange with the People's Republic of China, and proposes to initiate discussions with Mexico, Brazil, Japan, Ireland, South Africa and India.

On Friday, Ingraham indicated that the government is appreciative of China's support in this matter.

September 7, 2009

thenassauguardian


September 7, 2009 | 12:56 PM Comments  0 comments

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