Caricom concerned about G7 tax initiative
(From left) EU Economy Commissioner Paolo Gentiloni; Eurogroup President Paschal Donohoe; WorldBank President David Malpass; Italy's Finance Minister Daniele Franco; French Finance Minister BrunoLe Maire; Canada's Finance Minister Chrystia Freeland; Britain's Chancellor of the Exchequer RishiSunak; Managing Director of the IMF Kristalina Georgieva; Germany's Finance Minister Olaf Scholz; USTreasury Secretary Janet Yellen; Secretary-General of the Organisation for Economic Co-operation andDevelopment (OECD) Mathias Cormann; and Japan's Finance Minister Taro Aso pose for a family photoas finance ministers from across the G7 nations meet at Lancaster House in London, Saturday, June 5,2021 ahead of the G7 leaders' summit. (Photo: AP)

ROSEAU, Dominica (CMC) – Caribbean Community (Caricom) Secretary General Irwin LaRocque says Caribbean countries must be “concerned about the soundings” being made by the Group of Seven (G7) nations that last week announced a landmark deal that could help countries collect more taxes from big companies and enable governments to impose levies on United States tech giants such as Amazon and Facebook.

The agreement by the G7 finance ministers in London last weekend satisfies a demand by Washington for a minimum corporate tax rate of “at least 15 per cent” on foreign earnings and paves the way for levies on multinationals in countries where they make money, instead of just where they are headquartered.

The G7 countries said that the new deal is aimed at modernising the century-old international tax code and cools transatlantic tensions that threatened to spill into a trade war under Donald Trump. But, key details are still to be nailed down, more nations must sign on, and full implementation could take years.

“Only last week the G7 met. I must say that the soundings that they are making is something we have to be concerned about in terms of global tax rates and that sort of thing,” LaRocque said, as he appeared on the weekly television programme Annou Parle hosted by Dominica Prime Minister Roosevelt Skerrit.

“They keep moving the goal post when it suits them…in their case of development it was quite fine. Now they have reached a certain level, they are saying you must follow and not do as we did before. It is a real problem,” said LaRocque, urging the regional countries to send a message loudly to the international community.

“That is where the combined voices of Caricom countries matter, whether it is in the international financial institutions, whether it is in the European Union, because sometimes they do want things from us,” said LaRocque, who leaves office at the end of July after 11 years in the position.

“I have seen sometimes when we have held our ground that maybe they might reconsider a particular position and I think we have to recognise the strength that we have. The combined strength is greater than the sum of the individual member states, and I think we have to exercise that.”

Caribbean countries have in the past been critical of the European Union that have designated many regional countries as tax havens and placed them on so-called black lists arguing that they have not done enough to support global efforts at dealing with people seeking to evade taxes in their homelands.

LaRocque told viewers that Caribbean countries must put foreign investors on their agenda, adding: “We need to attract foreign investors as well.

“We cannot grow ourselves out of the debt trap that we are in. When you look at the debt figures in our region, the debt to GDP [gross domestic product] ratio in many of our countries, we will not be able to grow ourselves out with two and three per cent growth.

“We need to have some foreign investments coming in as well and I hope that our people will be more open and be open to such investments. Without an investment we are not going to make it,” he warned.

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