The team set up to review the Foreign Account Tax Compliance Act (FATCA) Inter-Governmental Agreement (IGA) between Barbados and the United States has completed its review and is ready for it to be submitted to Cabinet for approval. This update has come from the Central Bank of Barbados as the country gets ready to become FATCA-compliant by the June 30 deadline.
The main feature of the FATCA is that it will require, for tax purposes, financial institutions in Barbados to provide the United States with information on the accounts of American citizens in a certain threshold. A statement from the Central Bank said the documents had been vetted by the Office of the Chief Parliamentary Counsel, which has responsibility for advising on their appropriateness to the Attorney General who would in turn certify their readiness for execution to the Cabinet of Barbados.
The team submitted a detailed report to the Minister responsible for International Business on May 2. In the interim, however, the team has signalled to the United States that Barbados is ready to proceed to initial the agreement once the approval of Cabinet is obtained, the statement said.
It also stated that during the negotiation process, the team had made several enquiries of the United States, along with “suggested amendments but the USA, while acknowledging these suggestions, declined to make them, citing the need to have uniformity in their documentation”.
“In addition, detailed issues raised by the special negotiating team received comprehensive responses from the USA, which may be utilized to assist Barbados’ financial institutions should these matters arise in the coming months as they seek to ensure FATCA compliance.”
The United States indicated on May 23 that it would confirm its readiness to Barbados by the week commencing May 26, and thereafter the agreement would be finalized
and initialled by both parties. America’s Treasury Department has indicated that once Barbados initials the documents and Barbados consents, Barbados’ name will be placed on the published list of countries with which a FATCA IGA is deemed to be in place.
The formal execution will take place at a subsequent date.