Caribbean economies concerned with FATCA implementation

Caribbean Export Development Agency head Pamela Coke-Hamilton has expressed concern over the burden the forthcoming Foreign Account Tax Compliance Act (FATCA) is placing on the region’s financial institutions.

Speaking at the recent Caribbean Forum (CARIFORUM) Conference on the International Financial Services Sector in the Caribbean Region in Antigua, Coke-Hamilton said that FATCA “will require US tax authorities to levy a 30 percent withholding tax on foreign financial and non-financial institutions where new reporting requirements have not been met”. She explained that the law therefore requires expensive changes to IT infrastructure and to the legal framework governing financial services in the region.

(More: Caribbean nations urged to resist international pressure on tax, regulation, financial centers)

Caribbean nations are worried about the long-term competitiveness of their financial institutions in the face of pressure to tackle international fiscal and security concerns, FATCA being one example, on a scale dictated by richer nations.