Premier: UK summit provides opportunity to make Bermuda’s case
Bermuda’s attendance at a London summit to discuss the Overseas Territories role in ending tax evasion will be an opportunity to state Bermuda’s case that the Island is not a “tax haven” and is well regulated, Premier Craig Cannonier told the media yesterday.
Senior ministers of ten Overseas Territories and Crown Dependencies have been invited to the meeting next week by British Prime Minister David Cameron.
Mr Cannonier confirmed reports of the meeting at a media conference. He rejected the characterisation that he had been “summoned” to the meeting saying Bermuda was asked to attend voluntarily.
“Attending the UK meeting provides Bermuda with another opportunity — to articulate on a world stage that while we may all be British Overseas Territories Bermuda is fundamentally different in how we conduct our business. Bermuda is a low tax jurisdiction, not a tax haven,” he said.
Mr Cannonier repeated earlier statements that Bermuda has “no issue” with Britain’s approach to fighting tax evasion and “aggressive tax avoidance”.
The United States and the UK want the territories to sign up to agreements to share financial information and information on beneficial ownership of companies domiciled in the various jurisdictions.
Mr Cannonier stressed that many of the requirements were already in place. And he reminded the media that Finance Minister Bob Richards had agreed to sign an information sharing agreement with the US and the UK Governments — a decision which will further enhance Bermuda’s reputation.
He added: “According to the World Bank’s Governance Indicator Report, Bermuda is listed among the top ten percent.
“I want to make it clear that attending the UK meeting provides Bermuda with another opportunity to articulate on a world stage that while we may all be British Overseas Territories, Bermuda is fundamentally different in how we conduct business. Bermuda is a low tax jurisdiction — not a tax haven.
The Premier will also meet with Mr Cameron privately when the summit takes place next week on the eve of a G8 conference hosted by the UK.
“As a government, we will continue to be aggressive and look for opportunities to leverage these relationships and others for the benefit of Bermuda and Bermudians,” he said.
Mr Cannonier also said he understood that Mr Cameron was very concerned that corporations had been taking advantage of developing nations. “People feel that these countries are being pilfered and that’s something we don’t want to see.”
Asked if the distinction between “tax haven” and “low tax jurisdiction” was not just semantic, he said Bermuda’s taxation system is different in that it is primarily based on employment and consumption.
“It is a different format but in addition to that if you were to take some of the sovereign nations and strip away what they pay for defence and social insurance when you start looking at the percentage of tax we are very much on equal par, very balanced, and I think that’s something that hasn’t been championed in the past.”
The Premier also conceded that, ultimately, Bermuda may want to reconsider its Overseas Territories status.
Asked if he was comfortable with Bermuda’s status, he responded: “At this present time, yes. But I do believe that as we continue to mature — I’ve said it many times before — Bermuda has to take its future into its own hands. What that future is, is continuing to develop. As some of these things happen, we certainly have to consider how we position ourselves on the world stage and what it is we need to do to protect Bermudians, our standard of living and the likes.”
Bermuda’s standard of regulation is “superior to many of the G8 nations,” Premier Craig Cannonier insisted yesterday.
“We have not championed our cause enough, we have not made enough noise,” he told the media.
Asked whether Bermuda and the Overseas Territories had become the “whipping boys” or scapegoats of the larger nations, the Premier said: “Many of us do believe that. Depending on who you talk to, there’s probably a lot of political grandstanding going on. There is politics involved. But I’m concerned more about what it is Bermuda is doing to take control of the situation.”
Mr Cannonier was also reminded that HSBC chairman Douglas Flint’s remarks last month that the bank was cutting down on its involvement with tax havens failed to single out Bermuda as not being in the same category.
He agreed that captains of industry also had a role to play in pushing Bermuda’s case that “we are leaders in captive insurance, we are leaders in reinsurance and insurance. We’re not some of the banking domiciles as our friends down in the South who have maybe been implicated in many of these instances that have caused some concern.”
The Premier said that a recent study had shown that the US benefited greatly from the insurance industry here. Another study has found that companies domiciled here generate over 100,000 jobs and “millions and millions of dollars” in the UK.