Tax transparency: Seychelles' President highlights negative impact of 'partially compliant' rating in talks with President of European Council

Ramkalawan met Charles Michel on Tuesday on the sidelines of the 78^th United Nations General Assembly in New York. (State House)

President Wavel Ramkalawan highlighted the negative impact that the overall rating of "Partially Compliant" from the Global Forum on Transparency and Exchange of Information for Tax Purposes affects Seychelles, in a meeting with the President of the European Council.

State House said that Ramkalawan met Charles Michel on Tuesday on the sidelines of the 78^th United Nations General Assembly in New York.

Ramkalawan said that with the rating, it is probable that Seychelles is included in Annex I of the European Union list of non-cooperative jurisdictions for tax purposes.

The Seychelles' head of state also stressed the various critical reform efforts Seychelles has been engaged in.

"While we respect the position of the Peer Review Group (PRG) and the assessment team, we naturally oppose this rating, as we believe that we provided sufficient justification to be assigned a Largely Compliant rating. For one area of the assessment under Element A1, Seychelles was rated as Partially Compliant, which is largely due to one specific case, involving a single registered agent that has ceased its operations in Seychelles since 2018," he said.

Ramkalawan added that "since 2020 to date, Seychelles has undergone extensive reform in the form of legislative changes in key areas, to ensure the framework for exchange of information is in place - which the Report has acknowledged." 

He said that the legislative and administrative amendments have mitigated further re-occurrence of similar matters, but "despite exhausting all means to remediate the deficiency, and our ability to demonstrate the effectiveness of the reforms going forward, we continue to be adversely impacted in our rating."

Ramkalawan said, "Seychelles remains steadfast in our commitment to honour the international standards on tax transparency and be an effective partner in the exchange of information for tax purposes. We are already addressing the recommendations of the report, and welcome the opportunity to continue discussions with the Secretariat and Code of Conduct Group in relation to the progress and action plan to secure a favourable rating in the future."

On his part, Michel reaffirmed the European Council's continuous support for Seychelles and his commitment to finding possible solutions as well to take into consideration the above concerns raised by the President in relation to Seychelles' rating.

The Global Forum of the Organisation for Economic Co-operation and Development (OECD) maintained the rating for Seychelles as partially compliant in August.

It was a rating largely based on the demand for tax-related information on an agent previously registered in Seychelles, an archipelago in the western Indian Ocean.