Bermuda has become the 33rd signatory to a multilateral agreement setting out the parameters for the automatic exchange between tax administrations of country-by-country reports about multinational enterprises.
“We were one of the first jurisdictions in the world to sign up to the common reporting standard in 2014 as an early adopter of CRS and so I am proud Bermuda is again setting an example in adopting the country-by-country reporting regime without hesitation,” said Bob Richards, Bermuda’s minister of finance, announcing the signing, which took place last week.
The agreement, called the Multilateral Competent Authority Agreement for the Automatic Exchange of Country-by-Country reports, implements action 13 of the OECD/20 base erosion profit shifting (BEPS) plan, designed to provide countries with another tool to combat tax avoidance through transfer pricing.
Under the BEPS plan, large multinationals report to their country of residence specified information regarding each jurisdiction in which the group operates. Such information includes revenues, profits, income tax paid, stated capital, accumulated earnings, number of employees, and tangible assets.
That information is then shared with other countries pursuant to the multilateral competent authority agreement, tax information exchange agreements, and similar agreements.
Bermuda will require large MNEs headquartered in Bermuda to file country-by-country information relating the 2016 fiscal year by December 31, 2017, a government press release said.
Richards said the decision to sign the multilateral agreement followed a year-long consultation with industry.
The multilateral agreement has been signed by the following countries:
Australia, Austria, Belgium, Bermuda, Chile, Costa Rica, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Japan, Liechtenstein, Luxembourg, Malaysia, Mexico, Netherlands, Nigeria, Norway, Poland, Portugal, Senegal, Slovak Republic, Slovenia, South Africa, Spain, Sweden, Switzerland, and United Kingdom.
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