The Double Taxation Agreement (DTA) between Barbados and Mexico, which was signed in April last year has now become operational.
According to the Ministry of International Business, the Convention for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion, with respect to Taxes on Income and Capital Gains, which was signed on April 7, 2008, became effective on January 16.
The Convention will affect incomes paid or credited on, or after January 1, 2010, in respect of taxes withheld at source, as well as for other taxes during any taxable year beginning January 1, 2010 and beyond.
The agreement is expected to, among other things, increase cross border investment between Barbados and Mexico; foster investor confidence in Barbados as a legitimate tax jurisdiction in relation to investments, and deepen relations between the two countries. It also provides a mechanism for the resolution of any tax disputes which may arise.
This Convention brings to eighteen the DTAs already in force with the United Kingdom, Canada, United States of America, Finland, Norway, Sweden, Switzerland, CARICOM, Venezuela, Cuba, China, Malta, Mauritius, Botswana, Austria, the Netherlands, and the Seychelles.
In addition, the DTA signed with Ghana is awaiting ratification and the Agreement with Luxembourg is pending signature.
The expansion of its treaty network continues to be high priority for Government and, in this regard, negotiations have been scheduled with Italy, Spain and Iceland, February 23-24; March 2-6 and March 16-20, 2009 respectively.