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Cayman Islands sign tax agreement

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Issued 15 June 2009

A new double taxation arrangement (DTA) which will facilitate tax information exchange that meets OECD (Organisation for Economic Co-operation and Development) standards, was signed today by The Right Hon Stephen Timms MP, Financial Secretary to the Treasury and the Hon W McKeeva Bush, Leader of Government Business, Cayman Islands.

Welcoming the DTA Stephen Timms MP, said:

“Information exchange is a vital tool in ensuring that governments receive the revenues they need to resource the essential public services on which we all depend. 

 “I would like to congratulate the Cayman Islands Government for signing up to an arrangement which includes unprecedented provisions for tax information exchange that meet international standards of transparency.”

 HMRC Permanent Secretary for Tax, Dave Hartnett, added:

 “The information exchange provisions in this arrangement meet OECD standards of tax transparency and the agreement is especially welcome for that.

Information exchange enables us to confront effectively tax avoidance and money laundering whilst ensuring that we all make the right contribution to our public services.”

 The texts of the agreements can be accessed on the internet at: www.hmrc.gov.uk/international/cayman-eol.pdf

 The text will in due course be laid as a Schedule to a draft Order in Council for consideration by the House of Commons. It will then also be available from the Stationery Office. The arrangement will enter into force as soon as both governments have completed the legislative procedures needed to give it effect.

Notes:

1.             Double Taxation Agreements and Arrangements aim to eliminate the double taxation of income arising in one territory and paid to residents of another. They do this by dividing the taxing rights that each territory has under its domestic law over the same income.  More generally, they benefit the taxpayer by ensuring certainty of treatment and, as far as possible, by reducing compliance burdens.  The new arrangement with the Cayman Islands covers individuals and international shipping and air transport businesses.

2.            The UK currently has 113 Double Taxation Agreements (DTAs) in force, and has signed five comprehensive Tax Information Exchange Agreements (TIEAs), including with Guernsey in January and with Jersey in March 2009.  The UK’s other TIEAs are with Bermuda (in force), the Isle of Man (in force) and the British Virgin Islands (signed in 2008).  More DTAs and TIEAs are under negotiation.

3.            The new arrangement also provides for comprehensive exchange of information between the Cayman Islands and the UK to the OECD and international tax standard in respect of direct taxes and VAT.


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Article Published/Sorted/Amended on Scopulus 2009-06-21 11:35:16 in Tax Articles

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