US Attorney General Eric Holder would not characterise Bermuda as a tax haven, he stated yesterday.

Mr. Holder, paying a brief visit to the Island for talks with Premier Ewart Brown, answered questions from local media at a lunchtime press conference at the Fairmont Hamilton.

Asked by The Royal Gazette if Bermuda — which was listed as a “secretive” jurisdiction in a US Senate bill co-sponsored by Barack Obama — was a tax haven, America’s top lawyer appeared momentarily speechless.

He gestured to the Premier to respond, but a chuckling Dr. Brown indicated that Mr. Holder should address the query.

”Well, I don’t think Bermuda is a tax haven,” said Mr. Holder eventually. “There are issues that are of great concern to the Premier, issues that are of concern to the United States, issues that we have to work together on. “We have a variety of things that we have discussed, a variety of things that we will work together on to ensure that the relationship between our two nations — in a wide variety of areas — are addressed and so I think that I wouldn’t go as far as that and characterise Bermuda as a tax haven.”

Dr. Brown said: “Ditto from here. Of course, you know we don’t like that label because we know that it is not appropriate for Bermuda.

”And, in fact, things have been going very well in that area and we didn’t even get to touch on that subject this morning.”

Mr. Holder’s remarks were, in the main, welcomed by politicians and international business leaders, who described them as positive for the Island’s financial sector.

Deputy Premier and Finance Minister Paula Cox, in New York for the Annual Bermuda Financial Services Conference, said she regretted not getting to meet Mr. Holder.

“Bermuda does not hold itself out as a tax haven,” she said. “We are a well-developed international business financial centre. There was no reference or perception of Bermuda as a tax haven in our meetings today [but] a tremendous amount of interest and some great interchanges.

“What is notable is the continuing and steady inroads being made by Bermuda and how now <> especially given the economic fallout from the recession — Bermuda is being seen even more favourably.”

United Bermuda Party MP Patricia Gordon-Pamplin said she wished Mr. Holder had gone further and stated definitively that the Island was not a tax haven.

”Successive UBP and PLP governments have worked hard to achieve our pristine status,” she said. “With a bit more education on who we are and how we operate, Mr. Holder would indeed be in a position to make a definitive declaration. It is up to the PLP to ensure that the conversation is had in Washington.

”Michael Fahy, Bermuda Democratic Alliance’s finance spokesman, said Mr. Holder’s acknowledgement was a useful one.

”It is an important concession from the US Attorney General that he does not consider Bermuda a tax haven. Indeed it is not. However, we cannot allow ourselves to be complacent.

”Navigating the minefield of US special interests is difficult, at best, but consistent lobbying of our US friends is important so that any moves that may be made in the US to make Bermuda less attractive as an offshore jurisdiction can be stifled.”

Bradley Kading, president of the Association of Bermuda Insurers and Reinsurers, said: “The comment that he doesn’t characterise Bermuda as a tax haven speaks for itself.

“Bermuda has built a very good relationship with the US government under Premier Ewart Brown and Deputy Premier Paula Cox. This meeting with AG Holder attests to that.”

Cheryl Packwood, chief executive officer of Business Bermuda, said: “Those are important comments and we appreciate that Attorney General shared his point of view. We hope that this will have a positive impact on US public policy towards Bermuda.”

President Obama — who appointed Mr. Holder as AG last year — mentioned Bermuda directly when, as a senator, he proposed legislation to target offshore jurisdictions in 2007.

The Stop Tax Haven Abuse Act did not become law but during his 2008 presidential campaign Mr. Obama vowed to “shut down the tax havens”.

His administration has proposed in its 2011 budget tightening the rules on US insurers ceding premiums to overseas affiliates, which could impact the Island’s insurance industry.