Bahamas tax counter to EPA
ST. MARY’S, Antigua An oversight was committed by Bahamas government officials in declaring an export tax during the initial signing of the Economic Partnership Agreement with the European Union,Guardian Businesshas learned.
It’s information that was discovered in December 2010, revealed Branford Isaacs, leading trade specialist with the EPA Implementation Unit of CARICOM.
“There was no awareness of these export taxes on small collections… it applies to shellfish,”Isaacs told members of the media from throughout the region.”There are three member states that have taxes on exports… the other two declared it and it got them some time.
“But one member state did not act as expeditiously as it should have done.”
That country, he later identified, was The Bahamas. Having that specific tax in place, however, can run counter to the promotion of free trade of both goods and services between the region and the EU as designed under the EPA.
The Bahamas now has one of three options it can take in order to correct the situation, which apparently came as a surprise to many in the implementation unit.
The first option, he said, would be to discontinue applying taxes with regards to exports under the agreement, discontinue the export tax all together, or buy more time to phase out the tax collection in that area.
The government of The Bahamas’final decision on what option it will pursue will have to come before an EPA committee meeting scheduled for this summer.
It’s unknown at this point how the tax collection declaration was overlooked in the initial negotiations pertaining to The Bahamas and the trade pact.Guardian Business’attempts to track down this information from State Minister for Finance Zhivargo Laing were unsuccessful up to press time.
The EPA creates a free trade area between the European Union(EU)and the African, Caribbean and Pacific Group of States(ACP).
The Bahamas signed the EPA agreement as a part of the CARIFORUM sub-group within the ACP on October 15, 2008, however Article 63 of that agreement allowed The Bahamas and Haiti to have their commitments on services and investment incorporated into the EPA following a decision of the CARIFORUM-EC Trade and Development Committee. Negotiations related to services were completed on January 25, 2010.
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