Barbados and the Czech Republic signed the Barbados Czech Republic Double Taxation Agreement on October 26, 2011.
This latest Barbados tax treaty comes as the island continues to actively expand its tax treaty network and further enhance its attractiveness as a first class offshore jurisdiction.
Barbados Attorney General Adriel Braithwaite who is currently serving as the Acting Minister of International Business stated that the tax treaty “symbolizes the efforts of the Government to strategically enhance the investment flows between both countries.” Both himself and Edita Hrda, the Czech Republic’s Ambassador to Barbados agreed that this agreement represented an opportunity to increase trade and business relations between the two countries, enhance prosperity for both nations and strengthen the relationship between nations. Ambassador Edita Hrda advised that businesses should view the double taxation agreement as “an open door for both countries.”
Barbados has also signed a Double Taxation Agreement with Iceland. In addition, it has signed protocols to update the current tax information exchange provisions in previous Double Taxation Agreements that are already in place with Finland, Norway and Sweden in order to make sure that they are up-to-date and keep pace with current standards.
Barbados has also signed Tax Information Exchange Agreements (TIEAs) with Denmark, Greenland and the Faroe Islands.
The Barbados Panama Double Taxation Agreement and the Barbados Luxembourg Double Taxation Agreement are scheduled to come into effect from January 1, 2012 as part of the planned treaty network expansion.
Tax treaties play a major role in facilitating international business between treaty partners. They ensure that businesses trading internationally are not subjected to double taxation whereby they are taxed on the same profits twice in both countries, which places an undue burden on them as they expand trade internationally. Treaties also facilitate tax information exchange between partner nations to prevent tax evasion and avoidance.
The Barbados offshore sector has established itself as a transparent leader in the industry through its large treaty network and its willingness to share tax information with its partners. This approach has served the island’s interests well and has gone a long way to establish its legitimacy as a leading international business center.