18 December 2017Accounting & tax analysis

Bahamas signs key OECD commitment to tax transparency

The Minister of Finance for the Bahamas signed a Multilateral Convention on Mutual Administrative Assistance in Tax Matters. With this signing, The Bahamas becomes the 116th jurisdiction to join the world’s leading instrument for boosting transparency and combating cross-border tax evasion.

The Hon. Kevin Peter Turnquest, Deputy Prime Minister and Minister of Finance for the Bahamas signed the document in the presence of OECD Secretary General Angel Gurria.

The Convention is designed as an instrument for international tax cooperation providing for all forms of administrative assistance in tax matters: exchange of information on request, spontaneous exchange, automatic exchange, tax examinations abroad, simultaneous tax examinations and assistance in tax collection. It guarantees extensive safeguards for the protection of taxpayers' rights.

The Convention will enable The Bahamas to fulfil its commitment to implement the Standard for Automatic Exchange of Financial Account Information in Tax Matters and begin the first of such exchanges by 2018.

The Bahamas also recently signed the Multilateral Competent Authority Agreement (MCAA), in the margins of the 14th meeting of the Automatic Exchange of Information Group of the Global Forum on Transparency and Exchange of Information in Tax Matters which took place on 13-15 December 2017 in San Marino. The MCAA, which is a framework agreement specifies the details of what information will be exchanged and when and has been signed by 97 jurisdictions.

The Bahamas has also joined the inclusive framework on BEPS, which makes it the 110th jurisdiction participating on an equal footing in the BEPS Project as Associates. The Convention can also be used to swiftly implement the transparency measures of the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project such as the automatic exchange of Country-by-Country reports under Action 13 as well as the sharing of rulings under Action 5 of the BEPS Project.

“Signing ‘the Convention’ is an assertion of the commitment by The Bahamas to protect the integrity of its financial services industry and to effectively implement the OECD's international standards on tax transparency for the automatic exchange of financial account information,” said Turnquest.

“The Bahamas is a well-known leading international financial centre, as such, we will continue to maintain a well-regulated and transparent environment for the provision of international financial services. This week, we have taken major steps to ensure this by also signing the Multilateral Competent Authority Agreement (MCAA), and by joining the inclusive framework on Base Erosion Profit Shifting (BEPS)".