Antilles free trade zones come under scrutiny

21 May 2009

Antilles free trade zones come under scrutiny

Before the summer recess Interior Secretary Ank Bijleveld and Justice Minister Hirsch Ballin will produce a report on the so-called E-zones, the free trade zones (FTZs) to be found on a number of Antillian islands which remain part of the Kingdom of the Netherlands. The promise was made yesterday to SP Senator Sineke ten Horn during a debate on political relations within the Kingdom. These free trade zones are in reality tax havens. Any corporation claiming establishment within an FTZ, even if this amounts to no more than a post-box, is obliged to pay no more than 2% tax on its profits. Curaçao is the principal beneficiary.

On Tuesday, barely two days after a narrow majority on Curaçao had voted for a future in which the island will develop further towards independence, the Senate of the Netherlands debated the future of all of the Dutch Antilles, each of which will eventually go its own way, whether as an independent country or as a local authority within the Netherlands.

Although Sineke ten Horn declared her agreement with the process which the result of the referendum in Curaçao has set in motion, she insisted that a solution must be found to the problem of tax havens existing with the Kingdom of the Netherlands. "Surely we can't avoid discussing the continue existence of these zones within the Kingdom?" she said. "My party, in any case, cannot agree to that.”

According to Ten Horn this would also go against what was agreed in 1993 when Aruba – another of the Antillean islands - was preparing for the independence it gained three years later. “At that time we came to an agreement that in the case of regulations that were not deemed to be broadly acceptable internationally, or which lead to a disproportionate disadvantage for other parts of the Kingdom, the fiscal regime and the tax regulations must be adapted," she pointed out.

Ten Horn noted that these FTZs are also used for the transit of illegal narcotics and other smuggled goods, such as alcohol and cigarettes, as well as for money laundering. “Surely in our Kingdom we cannot content ourselves with making agreements about better law enforcement and the fight against serious crime, " she said "Shouldn't we also be discussing getting rid of the causes of such, such as these free trade zones?"

Secretary Bijleveld expressed no disagreement with this, and promised to produce a report on the zones and begin a 'Kingdom-wide' discussion of the issue.

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