Guernsey's Chief Minister, Lyndon Trott, has been reinforcing the Island's position as a leader in tax transparency during meetings with leading officials in Washington.
The Chief Minister last week met with Michael Mundaca, Assistant Secretary of the US Treasury Department, to discuss the continuing cooperative efforts of the two jurisdictions on tax transparency and information exchange.
Appointed by President Barack Obama in March 2010, Secretary Mundaca is the senior executive officer in the US government responsible for tax policy. The meeting builds on similar meetings between the two jurisdictions that began almost a decade ago and produced Guernsey's first-ever Tax Information Exchange Agreement (TIEA) in 2002.
Secretary Mundaca observed that in the year since Guernsey was placed on the OECD white list for meeting internationally agreed tax standards, many jurisdictions have been trying to catch up by signing TIEAs. He acknowledged however that these latecomers still have plenty of work ahead to make their TIEAs as effective as Guernsey's. Secretary Mundaca predicted that Guernsey will again stand out positively as the OECD's Peer Review Group evaluates countries that have implemented the internationally agreed tax standard.
The Chief Minister said: "I am delighted that Secretary Mundaca recognises and praises Guernsey's role as a leader in the implementation of international standards on tax transparency and information exchange.
"We have an excellent relationship with the United States which I believe will continue to grow and flourish during the coming years."
Secretary Mundaca reiterated his aversion to using outdated lists to blacklist jurisdictions in US legislation and noted that the inclusion of Guernsey on such lists demonstrates their unreliability. The US Congress recently enacted offshore tax enforcement legislation that does not use a blacklist approach.
The meeting with Secretary Mundaca followed talks with Robert Roach of the Senate Permanent Subcommittee on Investigations. It is commonly referred to as the 'PSI' and conducts extensive investigations and hearings on the business practices of corporations and their compliance with US regulations, laws, tax and accounting policies and general ethical business practices.
The Chairman of the PSI is Michigan Senator Carl Levin, who has held the top position on the PSI for more than 10 years and is the lead sponsor of the Stop Tax Haven Abuse Act. Guernsey is working hard and successfully to ensure that the US Authorities understand the facts about business carried out in Guernsey.
Mr Roach is Chief Investigator at PSI, where he has worked since 1997. The Chief Minister has met Mr Roach on several occasions starting in 2007 to discuss legislation proposed by Chairman Levin to enhance offshore tax compliance by US taxpayers. From the start, these discussions have been open, engaging and informative for both sides. This year, the Chief Minister asked Mr Roach to visit Guernsey and meet with the Island's financial services community to share his thoughts and experiences working in the US Congress.
The Chief Minister added: "I hope Bob is able to find time to visit Guernsey in the future. He is a key man in Washington and both understands and respects Guernsey's world-class financial services sector."
For more information about Guernsey's finance industry please visit www.guernseyfinance.com.
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