Guernsey has been commended for its leadership on tax transparency and cooperation by the Organisation for Economic Cooperation and Development (OECD) after concluding its 50th bilateral Tax Information Exchange Agreement (TIEA).
In recent weeks Guernsey has concluded bilateral TIEAs with jurisdictions including: Switzerland, one of Guernsey’s finance sector’s key trading partners; Gibraltar and Bermuda, both overseas territories with strong international finance sectors; Hungary and Slovakia, both members of the European Union and the World Trade Organisation; Swaziland and Lesotho, members of the Southern African Development Community and the African Tax Administration Forum.
The latest TIEA to be signed, with Bermuda, marked Guernsey’s 50th in total.
Monica Bhatia, head of the Secretariat to the OECD’s Global Forum on Transparency and Exchange of Information, said: "Guernsey has shown that a small jurisdiction with a clear commitment to transparency and exchange of information and strong engagement with partners can set the pace in developing an extensive network of tax information exchange agreements. This is a very impressive achievement."
The OECD is the supra-national body which, along with individual jurisdictions such as Guernsey, has driven forward tax transparency initiatives over the past decade, particularly since it launched the so-called ‘white list’ of tax transparent and cooperative jurisdictions in 2008.
Pascal Saint-Amans, head of Global Tax Policy, OECD, said: "Guernsey has been one of the most active jurisdictions promoting transparency in practice. Guernsey started negotiation of agreements prior to 2009, paving the way for many other jurisdictions. The number of TIEAs signed so far seriously enhances Guernsey’s reputation as a responsible and transparent financial centre, as recognised by the Global Forum peer review."
The praise from the OECD follows that from UK Prime Minister David Cameron earlier this year for Guernsey’s leadership on tax transparency, as well as his statement that there are no grounds on which to consider Guernsey a tax haven.
Gavin St Pier, treasury and resources minister, Guernsey, said: "Guernsey’s long-standing commitment to tax transparency is a central factor in cementing Guernsey’s reputation as a sustainable, stable and good place to do business. Our reputation and our competitiveness as an international finance centre are inextricably linked.
"I am delighted that we have reached this milestone through the hard work of the tax team in Guernsey. However I can assure the international community that we will not simply be resting on our laurels. We want to continue to be ahead of the curve in order to maintain our reputation and our competitiveness."
Fiona Le Poidevin, chief executive of Guernsey Finance, said: "The signing of Guernsey’s 50th TIEA emphasises Guernsey’s continued commitment to information exchange and the meeting of international standards. It puts us significantly ahead of other international finance centres in this regard and demonstrates that the Island is held in high esteem by our trading partners.
"When combined with the knowledge that Guernsey has signed Double Taxation Arrangements (full or partial) with 20 countries, the signing of these agreements is welcomed by those within industry itself. It provides clarity and certainty on matters of taxation, which makes it more attractive to conduct business between Guernsey and other jurisdictions."
Guernsey started negotiating TIEAs in 2001 and signed its first, with the US, in 2002. The Island’s policy since then has been to demonstrate its commitment to transparency and exchange of tax information by negotiating agreements with as many relevant jurisdictions as possible including OECD, G20 and EU members, as well as other jurisdictions where Guernsey may have a domestic tax interest of its own in obtaining information.
Rob Gray, director of tax, Guernsey, said: "This is an important milestone, but the work goes on, however, as we try to arrange the signature of the 17 further TIEAs and DTAs, which have already been finalised, and complete negotiations on several other agreements we currently still have under discussion. With possible participation in the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters and signature and putting into effect FATCA based agreements, similar to the one recently signed with the UK, with the US, and possibly significantly more countries on the horizon, there is little time to reflect on our previous achievements."