The Government of the British Virgin Islands (BVI) has hired another attorney from the UK to draft legislation intended to keep the territory off the European Union’s blacklist of tax haven jurisdictions.
The government will not be incurring any additional expenses for the second attorney, according to a Cabinet’s statement.
Government initially retained the first attorney, Furness, at a cost of up to $400,000 but his legal fees have been reduced to $300,000.
Junior counsel Rivett will now work in conjunction with Furness at a cost not exceeding $100,000 local media outlet BVINews reports.
Furness and Rivette were specifically hired to draft local laws in an area of financial services known as ‘economic substance’, within which the EU says the BVI is deficient.
The EU wants the BVI to show it has economic substance by ensuring the taxes it collects within the financial services sector were generated through real economic activity in the territory.
In other words, proof that an offshore company is paying taxes in the BVI because it largely does its work and earns its profits in/from the BVI.
The BVI will be added to the EU’s blacklist and subjected to diplomatic sanctions if it does not have these laws in place by the end of the year.