T&T senate starts debate on weakened tax transparency bill

A political standoff in Trinidad & Tobago (T&T) has dealt a setback to the government's efforts to comply with international tax transparency standards, with the ruling party forced to water down key legislation to force its passage.

Introduced in May by the People's National Movement (PNM),the income tax amendment bill is one of three legislative proposals the PNM sees as needed to win removal from tax haven blacklists maintained by the EU, the OECD's Global Forum on Transparency and Exchange of Information, and the Financial Action Task Force (FATF).

The government ramped up pressure in November to pass the first initiative by November 30 in an effort to meet the Glob­al Fo­rum/EU standards. The gov­ern­ment al­so need­ed to meet a Caribbean Fi­nan­cial Ac­tion Task Force (CFATF) dead­line last Fri­day.

With the clock running out Friday, the ruling party opted to cut the five of 10 clauses in the bill that required a two-thirds majority to pass. The amended bill passed 19-14, and the senate is set to debate it on Tuesday.

"Over the last month it be­came ob­vi­ous the op­po­si­tion wouldn't sup­port the bill and one of the rea­sons ap­peared to be the clause al­low­ing po­lice eas­i­er ac­cess to tax in­for­ma­tion from [tax agency] in­land rev­enue. But we agreed to their call to add ju­di­cial su­per­vi­sion in the sit­u­a­tion," said finance minister Colm Imbert, as reported in local daily Trinidad & Tobago Guardian.

"That clause was one of CFATF's rec­om­men­da­tions and we were able to pass that with a sim­ple ma­jor­i­ty. If we didn't, CFATF would have black­list­ed us. It's iron­ic that the clause that was passed with sim­ple ma­jor­i­ty vote was one they had con­cerns about - they shot them­selves in the foot," he added. "The claus­es which re­quired op­po­si­tion votes for pas­sage and which we delet­ed were the in­for­ma­tion as­pects Glob­al Fo­rum re­quired."

The opposition UNC party has criticized what it sees as a piece-meal approach to the ruling party's tax transparency plan, and member of parliament David Lee accused the government of maintaining a narrative of "the opposition protecting criminals" to force the UNC's hand.

"At this point they need this narrative to be prolonged so they can mask the hardship they are putting this country through with their failed economic policies," said Lee on the UNC website.

Tuesday marks the one-year anniversary of the EU's initial release of its tax haven blacklist. The list has since narrowed from 17 tax jurisdictions to five, including T&T.