BRIDGETOWN, Barbados, CMC—Barbados has signed the Multilateral Convention to Facilitate the Implementation of the Pillar Two Subject to Tax Rule (STTR MLI), joining several jurisdictions in strengthening global tax cooperation.
A government statement said that Ryan Straughn, the Minister of Finance, signed the agreement during a ceremony in France and that it seeks to ensure fairer and better international tax arrangements, particularly for developing countries.
The statement said that in addressing the members from more than 57 countries, Straughn noted that Barbados is a committed partner and highlighted the need for small and vulnerable states to participate in the process.
He also thanked members for understanding that the impact of the reforms is much more acute than for large states, as smaller ones enable these global changes. He noted that the corporate reform and Barbados’ compliance signal new confidence for businesses and investors alike.
At the ceremony, nine participating jurisdictions signed the STTR Multilateral Instrument, and ten signed a letter of intent to sign it as soon as possible.
Twenty-four participating jurisdictions that are outside the scope of the STTR commitment signed a statement of support, and 14 jurisdictions that chose not to implement the STTR via the STTR Multilateral Instrument at this stage joined the ceremony as participants.
The statement said that Straughn also held an introductory bilateral meeting with Secretary-General of the Organisation for Economic Cooperation and Development (OECD), Mathias Cormann, and Director of the Centre for Tax Policy and Administration, Manal Corwin, both of whom said they were committed to strengthening ties with Barbados through both tax and non-tax initiatives.
“Today’s signing ceremony is a further significant milestone in the implementation of the Two-Pillar Solution to stabilize the global tax landscape, to reduce the incentive for multinationals to profit shift, curb harmful tax competition, remove inappropriate pressure on countries to offer low or no corporate tax arrangements in return for investment and help to generate important additional revenues for governments around the world,” said Cormann.
The STTR is vital to the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting. It aims to address the issue of low or no taxation on cross-border payments by ensuring a minimum tax rate of 9 percent on specific income streams.
The STTR is designed to prevent situations where income escapes appropriate taxation due to discrepancies in tax regimes.
“The signing marks a milestone in Barbados’ ongoing commitment to fair taxation, reducing profit shifting, and curbing harmful tax competition. As an early adopter, the statement added that Barbados sets a precedent for countries to allow developing countries to protect their taxing rights and secure sustainable revenue streams for the future,” the statement added.
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