The Cayman Islands and Belize have become members of the “Inclusive Framework on BEPS,” the OECD announced April 13.
The inclusive framework is a group of countries that have pledged to put into place minimum standards aimed at preventing tax avoidance and improving tax dispute resolution that were designed by OECD and G20 countries in the 2015 base erosion profit shifting (BEPS) project.
With the Cayman Islands and Belize joining, membership in the inclusive framework now stands at 96 countries and jurisdictions.
The commitment means that the two countries have agreed to adopt BEPS “minimum standards” on tax treaty shopping; implement country-by-country reporting for transfer pricing; limit benefits of any intellectual property or other preferential tax regimes; and fully implement the mutual agreement procedure in their tax treaties. The countries must also pay a fee to participate.
In return, the Cayman Islands and Belize will be permitted to work alongside OECD and G20 countries on an equal footing to ensure widespread adoption of the BEPS minimum standards, which will be subject to a peer review process.
The countries will also participate in some remaining BEPS project international tax standard setting work; participate in ongoing data gathering on the tax challenges of the digital economy; and work on measuring the impact of BEPS.