Vastly outstripping the number of Tax Information Exchange Agreements (TIEAs) required by Organisation for Economic Co-operation and Development (OECD) member nations, The Bahamas last week officially concluded a tax treaty with Japan.

The requisite number of TIEAs stipulated by the OECD for international tax compliance is 12. The Bahamas has now signed TIEAs with 17 OECD members and nine members of the G-20.

Although relatively subdued of late, the Japanese economy still remains one of the world’s largest and the agreement represents a continued commitment to international standards for financial regulation and building bilateral ties.

“This TIEA with Japan not only provides for co-operation in tax matters to the internationally accepted standards, but also provides for the allocation to each party certain exclusive taxing rights in respect of income from sources in the other contracting party, which is received by designated groups of students, pensioners and government employees,” said Deputy Prime Minister and Minister of Foreign Affairs Brent Symonette at the signing ceremony held in Nassau on January 27.

“It is a first, but by no means the last, of its kind for The Bahamas; and demonstrates the range and diversity of tax cooperation that countries have the opportunity to engage in, bilaterally, for their mutual economic benefits.”

Also present at the ceremony were negotiators representing the Japanese Ministries of Foreign Affairs and Finance, and the Ambassador of Japan to the Commonwealth of The Bahamas Hiroshi Yamaguchi.

The Deputy Prime Minister concluded by saying: “The [Bahamas] government is confident that with the continued strategic broadening and deepening of its tax co-operation network the country will continue to grow and prosper as an international business centre of choice for global citizens. The Bahamas looks forward to the continued expansion of the co-operative relationship between our two countries.”

Download the PDF of the TIEA here.