LONDON, (Reuters) – The British Virgin Islands said yesterday it will sign a data sharing pact with New Zealand, winning the Caribbean money centre a place on the global “white list” of countries committed to catching tax dodgers.
The G20 group of leading industrialised and emerging market countries agreed in April to crack down on countries that failed to help out in cross-border tax evasion cases.
Countries that had not signed at least 12 bilateral tax information exchange agreements in line with standards set out by the Paris-based Organization for Economic Cooperation and Develop-ment were put on the OECD’s “grey list”.
The British Virgin Islands signs its 12th pact tomorrow, with New Zealand, so that it will achieve “white list” status. It will also help BVI counter any accusations of being too soft on tax evaders.
Sherri Ortiz, executive director of BVI’s International Finance Center, said it was a “bittersweet” moment.
The island has pushed for several years to sign enough bilateral deals after its first agreement, with the United States, in 2002, Ortiz said.
“At that time, tax information exchange agreements were not heard about and not encouraged as people saw them as something that opened up a Pandora’s Box and hampered your client relationship,” Ortiz told Reuters.
The tiny country of 25,000 people has some 450,000 foreign companies registered there, helping to make the wider Caribbean region the world’s fourth largest banking centre.
Separately yesterday Britain and Liechtenstein signed a similar agreement. Ortiz said the G20 pledge in April has made other countries more willing to sign bilateral deals and BVI expects to seal a few more in coming months, starting with the Netherlands.
BVI has already supplied tax information to the United States but not yet to Australia and the United Kingdom, two countries is sealed agreements with in late 2008.
The global financial crisis sparked a slowdown in company registrations up to about four months ago.
“Since then we have seen a constant improvement in the numbers once again. We are seeing certain areas of the economy from various jurisdictions coming out of recession and there is quite a lot of evidence we have seen the worst of it,” Ortiz said.
