The tax information exchange agreement – the first of its kind for Seychelles – was signed by principal secretary for finance Ahmed Afif in the presence of Albert Geerz, the Dutch honorary consul here.

Also at Liberty House were the Finance Ministry’s director general for policy and strategy Rupert Simeon, the Seychelles Revenue Commission’s (SRC) audit manager Gayathri Andre and the Seychelles International Business Authority’s (Siba) head of policy research and training Michael Berlouis.

On the Dutch side the agreement had earlier been signed by the deputy head of mission in Nairobi, Hans Docter.
Mr Afif said this is the first such accord Seychelles has signed, and it will help in the battle to bring about greater transparency in international transactions.

“We strongly believe that we need to develop an international business centre in Seychelles and promote international financial services,” he added.

Mr Afif said it is vital for Seychelles to meet the expectations of regulatory bodies such as the Organisation for Economic Cooperation and Development (OECD).

This body brings together the governments of countries worldwide that are committed to democracy and the market economy, so as to support sustainable economic growth and maintain financial stability.

“We have to be seen as a jurisdiction with best practices and ensure that companies based in both countries cannot do business without paying their taxes,” said Mr Afif.

For example, if there is a Seychellois company in the Netherlands that is avoiding paying taxes, then all the necessary information should be available from this country for an investigation, he added.

Through this agreement each country will ensure that its relevant authority has the power to obtain and provide on request information held by banks and other financial institutions.

This also involves information on the ownership of companies, partnerships and trusts.

The Netherlands will, when making a request for information under the agreement, give details such as the identity of the person who is being investigated, a statement of the information sought, the tax purpose for which it is sought and the name and address of any person believed to have that information.

Mr Afif said through these norms Seychelles aims to show the OECD that it is committed to the rules of transparency and exchange of information.

He said the OECD meets regularly and its members have to ensure they are up to date with international law regarding businesses and there are no loopholes that can lead to tax evasion.

The Ministry of Finance, Siba, the Central Bank, the SRC and other final institutions also have to keep themselves up to date on new demands by international institutions and see that our laws are up to standard, he added. Seychelles cannot afford to be blacklisted as it is a small and vulnerable country that depends on imports.

“We have to be compliant and work with these institutions and at the same time show our ability to work as a team with all the international partners,” said Mr Afif.

As soon as other countries are ready, Seychelles will sign a similar agreement with them, he added.
Mr Geerz said the agreement shows the good cooperation that has been in place for a very long time between the two countries.
 
“It shows that regarding tax matters things are developing further, and this will be in the best interests of both partners,” he said.

On the question of whether such an agreement could reduce the number of offshore companies here, Mr Berlouis said all global members of the OECD have already agreed to meet these standards.

“Businesses involved in tax evasion have to move out,” he said.

The alternative to signing this agreement would be for Seychelles to become a secret jurisdiction, Mr Berlouis said.
“This would attract criminals such as money launderers and tax evaders, which we do not want,” he added.

“We would also carry the risk of being blacklisted, and legitimate businesses would then not want to be based here.”