THE Bahamas yesterday upgraded its tax information exchange agreement with Finland to the automatic variety, as it bids to meet global standards by September 2018.
K P Turnquest, deputy prime minister, signed the Protocol to Amend the Tax Information Exchange Agreement between the Bahamas and Finland, with the latter's ambassador to the Caribbean, Jukka Pietikäinen, signing on behalf of the European nation.
Mr Turnquest said: "By the implementation of the Common Reporting Standard, the Bahamas shows its intent on remaining a well-regulated, compliant and legitimate international financial centre with a strong anti-money laundering (AML) and counter-financing of terrorism (CFT) regime."
Yesterday's signing ceremony upgrades the first Tax Information Exchange Agreement (TIEA) with Finland, which facilitates the exchange of information on request.
The agreement now facilitates the automatic exchange of tax information, bringing it into compliance with the Organisation for Economic Co-operation and Development's (OECD's) Global Common Reporting Standard (CRS)- the new global standard.
Mr Turnquest said the Bahamas' Automatic Exchange Financial Account Information Act came into effect on January 1, 2017, with the accompanying regulations approved and brought into force on March 7, 2017.
"The Bahamas will commence exchanging financial account information with its AEOI (automatic tax information exchange of information) partners in September 2018," he added. "By signing this protocol today, the Bahamas and the Republic of Finland will now be AEOI partners."
Mr Turnquest said that at the outset, the Bahamas chose the OECD Global Forum's bilateral approach as the method for automatically exchanging information. However, on May 29, 2017, the Government formally indicated to the OECD its interest in becoming a party to the Multilateral Convention for Mutual Assistance on tax matters.
"The Bahamas will continue assisting and co-operating with jurisdictions in the effort to deter and prevent tax evasion and avoidance, and increase transparency and exchange of information for tax purposes," he said.
Mr Turnquest added that tax evasion and avoidance were common problems experienced by many countries, and eroding the basis of tax systems and destroying the reputation of legitimate international financial centres (IFCs).