We are not alarmists.
That’s the position of the Banker’s Association of T&T (BATT) when it comes to its statements on becoming compliant with the Tax Information Exchange Bill, 2016 and on the repercussions if T&T does not do so.
BATT made the statement yesterday, ahead of a meeting on Monday with the Opposition to discuss the issues on the table concerning the bill. The meeting will be held at the Opposition’s Charles Street, Port-of-Spain office.
Speaking at a press conference at Scotiabank, Port-of-Spain, yesterday BATT president Anya Schnoor said T&T’s economy is already being battered by the effects of the falling oil prices and rising unemployment. As a result, she said we could not take the “risk” with compliance since it would weaken T&T’s banking sector.
“We run real reputational risks to our country and we potentially put at risk the entire stability of the banking system and the hundreds and thousands of customers it serves,” Schnoor said.
“While I have read the comments in the press that may be the bankers are being alarmists, let me assure you that I work for a bank which operates around the world and I have seen first hand the effects on small countries which have tried to thumb their noses at their global AML and FATCA obligations.”
Asked what international investors are saying when it comes to T&T’s non-compliance with the FATCA, she said they are monitoring the situation. Schnoor noted, however, that if T&T does not meet the February 2017 deadline investors could opt to invest in other countries in the Caribbean which are compliant.
Confirming that the bankers received a copy of the updated and amended version of the bill from Attorney General Faris Al-Rawi, she said there were two comments which the bankers had on the new bill.
“BATT does not consider that the MoU between the competent authority and the secretary of the Treasury should be subject to the affirmative resolution of Parliament.
“The MoU would contemplate procedural matters supporting the exchange of information between them. This exchange is governed by the legislation and the Inter-governmental Agreement and therefore should be left with the remit of the Government to administer and agree.”
She also said if the bill is made subject to existing laws such as the Data Protection Act and Financial Institutions Act, “as these relate to confidentiality, the bill may be rendered ineffective. The disclosures being sanctioned by the legislation apply to persons who are already subject to US reporting requirements and therefore mandated by US law to provide the information being exchanged in any event.”
Far reaching effect
Other business groups who were present included: the Association of T&T Insurance Companies, T&T Coalition of Service Industries, T&T Chamber of Industry and Commerce, American Chamber and the Bankers Association of T&T.
The business groups collectively stated that they were worried about meeting the February 2017 deadline for becoming compliant and are not convinced the US authorities would give a fourth extension of the deadline.
TTCIC chief executive Gabriel Faria said he was not happy with the quality of the debate coming out of the Parliament when it came to the bill.
“I am personally disappointed with the quality of the discussion that’s occurring and as citizens of this country, we need to demand from our politicians that they mature the quality of the political discussion that is occurring.”
ATTIC president James Camacho noted that if T&T does not become compliant with FATCA, reinsurance could be affected by the 20 per cent withholding tax. This means that 30 per cent of the value of what the insurer should get from their bonds and equities invested abroad would be deducted from the total amount.
AmCham president Ravi Suryadevara said the changes to the bill pertain to US citizens living in T&T who are already obliged to disclose their information to the US Treasury, and becoming compliant therefore does not put a greater obligation.