Yesterday, the US Treasury Department announced that the United States had signed a new tax information exchange agreement with Antigua and Barbuda. The agreement was signed by Secretary Paul O’Neill and the Hon. Lester Bird, Prime Minister and Minister of Finance of Antigua.
Sir Roland M. Sanders, Chief Foreign Affairs Representative of Antigua and Barbuda with responsibility for having negotiated the Exchange Agreement, subsequently announced that the document follows the model of the Barbados-US TIEA signed a few years ago. He indicated that Antigua and Barbuda had signed this agreement to show that it is:
(a) willing to enter TIEAs that are “negotiated” not “imposed” as with the OECD;
(b) ready to enter negotiations that are “reciprocal” and not “non-reciprocal” as in the OECD’s Harmful Tax Competition Initiative (HTCI); and
(c) willing to enter TIEAs that give us equal status in determining the application and interpretation of its clauses.
He stated further, *”the TIEA conforms with our domestic laws and we are not required to change them to suit anyone as with the OECD HTCI”*
Indications were that while in Washington the delegation from Antigua and Barbuda took the opportunity to raise with Secretary O’Neill continuing concerns about the OECD’s HTCI, and that Prime Minister Bird will be following up the discussions with a formal letter to Mr. O’Neill.
At the signing in Washington, Secretary O’Neill said, *”The agreement we are signing today provides continuing evidence of our commitment to establishing and maintaining effective information exchange relationships with countries across the Caribbean and throughout the world. I want to extend my sincere appreciation to the government of Antigua and Barbuda for demonstrating its desire to cooperate with the United States in our efforts to ensure adequate enforcement of our tax laws.
“As I have said many times, we have an obligation to enforce our tax laws because failing to do so undermines the confidence of honest taxpayers in the fairness of our tax system. Today’s signing marks another important step forward in our efforts. I look forward to future cooperation with the government of Antigua and Barbuda in this critically important area.”*
On November 27, the Treasury Secretary signed a new tax information exchange agreement with the United Kingdom, including the Cayman Islands, that will allow for exchange of information on tax matters between the United States and the Cayman Islands. The agreement was signed by Treasury Secretary Paul O’Neill, United Kingdom Ambassador Sir Christopher Meyer and Cayman Island Governor Peter J. Smith CBE. At that time, Secretary O’Neill said, *”This tax information exchange agreement we are signing today represents a significant development in the cooperative relationship between the Cayman Islands and the United States and in our efforts to prevent our financial institutions from being used to further illegal activities.”*’
This past summer the US Treasury Secretary, during Congressional Testimony, publicly expressed his intention to quicken the pace for obtaining new tax information exchange agreements.