Barbados has satisfied the Organisation for Economic Cooperation and Development (OECD) that it is collecting and sharing tax information on large multinational enterprises (MNEs) operating in the country.
This is in fulfillment of a commitment to strengthen tax transparency through country-by-country reporting under the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project.
The OECD, an international tax watchdog based in Paris, France, defines BEPS as “tax avoidance strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations”.
Barbados is one of 142 jurisdictions under the OECD’s Inclusive Framework which have agreed to implement minimum standards to improve transparency over the global operations of large MNEs reaching a US$850 million consolidated group revenue threshold.
On September 23, the OECD released its eighth annual peer review results on the implementation of BEPS Action 13 on Country-by-Country Reporting, which is an assessment of how jurisdictions are implementing the country-by-country reporting minimum standard as of April 30.
The BEPS Action 13 minimum standard on country-by-country reporting requires tax administrations, in this case, the Barbados Revenue Authority, to collect and share detailed information on all large MNEs doing business here.
Information collected includes the amount of revenue reported, profit before income tax, and income tax paid and accrued, as well as the stated capital, accumulated earnings, number of employees and tangible assets, broken down by jurisdiction.
The latest OECD report examined Barbados’ implementation in three areas – domestic legal and administrative framework, exchange of information network, and appropriate use of country-by-country reports.
It said regarding the domestic legal and administrative framework that Barbados “confirms that its rules have not changed and continue to be applied effectively. Barbados continues to meet all terms of reference”.
On the exchange of information framework, the peer review report stated: “Barbados made some exchanges of country-by-country reports after the deadline. This was caused by a technical issue which has since been resolved and so no recommendation is required.
The OECD document also assessed Barbados’ appropriate use of country-by-country reports.
“Barbados confirms that its rules have not changed and continue to be applied effectively. Barbados continues to meet all terms of reference,” it noted.
The report said there were no recommendations for improvement in Barbados’ fulfillment of the three areas of implementation.
In its review of Barbados’ country-by-country reporting efforts, the OECD said that the island first reporting fiscal year commenced on or after January 1, 2021.
Filings are required 12 months following the end of the reporting fiscal year and the first review of Barbados’ domestic legal framework took place in fiscal year 2021-2022.
As a member of the Inclusive Framework, Barbados has committed to implementing four minimum standards.
These are Action 5 – Counter Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance; Action 6 – Prevent Treaty Abuse; Action 13 – Guidance On Transfer Pricing Documentation and Country-by-Country Reporting; and Action 14 – Make Dispute Resolution Mechanisms More Effective.
In February, the OECD said that Barbados had made significant progress in addressing harmful tax practices through the implementation of Action 5.
The organisation reminded in its recent publication that the next peer review report will be released in the third quarter of 2026.
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