The International Monetary Fund has praised Caribbean territory Saint Kitts and Nevis for its progress on fiscal and economic matters.
First, the IMF welcomed Saint Kitts and Nevis’s comprehensive reform of its Citizenship-by-Investment (CBI) program. This program had been criticized by countries including the United States, which said it is “attractive to illicit actors because the program, as administered, maintains lax controls as to who may be granted citizenship As a result of these lax controls, illicit actors, including individuals intending to use the secondary citizenship to evade sanctions, can obtain an SKN passport with relative ease.”
The IMF emphasized the importance of safeguarding fiscal sustainability and recommended the implementation of a prudent framework to help the territory build fiscal buffers. To this end, the IMF recommended that the territory further broaden the tax base, to build on the earlier introduction of a value-added tax regime, and streamline tax incentives. It also said tax administration could be improved, to boost compliance rates.
The IMF recognized that a reduction in correspondent banking relationships continues to be an issue for Saint Kitts and Nevis. To limit the risk of losing correspondent banking relationships, the IMF said that the territory needs to maintain “watertight” laws to prevent money laundering and the financing of terrorism, and to fully comply with international standards on transparency and the exchange of tax information.