Nov 10 – GSD Welcomes OECD Rating
The GSD Opposition says it welcomes the news that the OECD has rated Gibraltar as 'Largely Compliant' in relation to the exchange of tax information in practice.
Given what it callsthe “shoot from the hip” criticisms by Minister Isola last week, the Opposition would also like to point out that when Gibraltar was transferred to the so called “White List” in October 2009 after the Gibraltar Government had signed 13 Tax Information Exchange Agreements, there was a “muted silence from the then Opposition benches.”
The GSD says that they, on the other hand, “have no hesitation in congratulating all those involved.” Indeed, it says, it is worth recalling that by the time that the GSD left office in 2011 the Gibraltar Government had signed over 20 such agreements with leading jurisdictions.
While the GSD says that Gibraltar is therefore seeing a continuation of GSD policy in this area, which is largely driven by an international agenda on the part of the OECD and EU, under which Gibraltar (like other finance centres) is giving up tax confidentiality in defined circumstances, it is equally imperative that those countries that have benefited from Gibraltar doing so do not continue to unfairly discriminate, under their own tax systems, against Gibraltar companies trading with entities or persons within their territories. There must be a level playing field, argues the GSD, otherwise Gibraltar will end up with all the burdens of compliance in taxation as a result but not all the benefits of having a compliant tax system. That would simply place Gibraltar at a significant disadvantage and would be unacceptable, it adds.
One area of potential tax discrimination, according to the GSD, arises as a result of Gibraltar not having Double Taxation Agreements. This is because some countries make provision in their domestic tax legislation that if they do not have a Double Taxation Agreement with another jurisdiction (notwithstanding that they might have a tax information exchange agreement) entities in those jurisdictions are penalised and discriminated against for tax purposes. This can be a potential disincentive for institutional investors using Gibraltar, says the GSD, when they come to select a domicile compared to say Malta which does have double taxation agreements.
Leader of the Opposition, Daniel Feetham said: “We offer to work with and support the Government where necessary in order to prevent unfair discrimination against Gibraltar companies and ensure there is a level playing field. This is an important issue for the Finance Centre and one that we believe should be above party politics.”
