The Tribune

THE Tax Information Exchange Agreement (TIEA) between the Bahamas and Canada which came into force last week "will further cement the relationship between the two countries" it was stated yesterday. In a bulletin from the law firm of Higgs and Johnson it was stated: "The TIEA will ensure that the dividend profits of Bahamian companies with Canadian parents are only taxed upon repatriation to Canada. "It will allow Canadian companies to take advantage of the human resources and infrastructure which the country offers and does not impose significant conditions on the Bahamian affiliates." The firm added: "The Bahamas has long-standing economic links to Canada, particularly in the financial services and hospitality sectors and it is thought that the TIEA will further cement the relationship between the two countries. "The Bahamas now has signed 28 TIEAs altogether including 18 with OECD member countries." Many Canadian companies are reportedly looking to capitalise on the opportunity, and want to do business in the Bahamas. Barbados is a jurisdiction that has a 'double tax' treaty with Canada, and therefore has been a place where Canadians have created foreign operations. The new TIEA between the Bahamas and Canada will put the Bahamas on an equal footing with Barbados with respect to tax incentives. The Bahamas-Canadian TIEA was signed in June 2010. The Bahamas' International Tax Cooperation Act 2010 is the enabling legislation for the TIEAs this jurisdiction has signed.