According to Reuters, the negotiation is being done over fears that global banks with headquarters in London could be affected. Many major banks are headquartered in the City of London but generate more than half of their income elsewhere.
While the G7 tax system, which is proposing a global minimum tax rate of 15%, is reportedly not expected to have significant impacts on the [British] Virgin Islands (VI), the move by the UK has exposed its double-standards and callousness for the VI and its Overseas Territories (OTs).
Despite the projected severe negative impact on the VI’s financial services industry, one of the two main pillars of the economy, the UK has been relentlessly pushing for its Overseas Territories to introduce public registers of company beneficial ownership and had threatened to do this by an Order in Council.
The UK; however, went against imposing the policy via the Order in Council after the OT’s threatened legal action and said the OTs will be given until 2023 to introduce public registers.
Publicising the names of these beneficial owners could discourage financial service clients from doing business with the VI.
The VI has maintained that it has no issues implementing public registers once it becomes a global standard.
Meanwhile, Deputy Premier and Minister for Education, Culture, Youth Affairs, Fisheries and Agriculture, Hon Natalio D. Wheatley (R7), has said the UK negotiating for the City of London to be exempt from the global tax plan, while not making any considerations for the VI, speaks of the type of “partnership” between the two.
“I wonder whether they negotiated exemption for the BVI? We all know the answer to that one. Modern partnership they say...,” Dr Wheatley sarcastically wrote on his Facebook page today, September 12, 2021.