The Assistant Treasurer, Senator Nick Sherry, today announced that Australia has signed a bilateral tax treaty with the Marshall Islands for the exchange of tax information.
'This signing is a significant landmark in the Rudd Government's program to improve tax transparency in the global economy," the Assistant Treasurer said.
'Securing this latest tax information exchange agreement (TIEA) further expands Australia's TIEA network – which is growing rapidly.'
"The Marshall Islands is the 25th jurisdiction to sign such an agreement with Australia," said the Assistant Treasurer.
"The Rudd Government welcomes the Marshall Islands as a partner in the important work of preventing offshore tax avoidance and evasion. The signing of this agreement demonstrates the Marshall Islands' commitment to international tax standards."
"It shows the progress being made worldwide to improve transparency in the financial system – with Australia a world leader in this field as the current Chair of the Global Forum on Transparency and Exchange of Information for Tax Purposes."
The agreement was signed in Majuro by the Marshall Islands Acting Finance Minister, Brenson Wase and Australia's Ambassador to the Federated States of Micronesia, Palau and the Marshall Islands, Susan Cox.
In addition to the TIEA, Australia and the Marshall Islands also signed an Additional Benefits Agreement (ABA). The ABA will establish an administrative mechanism to resolve transfer pricing disputes between taxpayers and the revenue authorities of Australia and the Marshall Islands and eliminate double taxation of certain income derived by retirees, government employees and students.
The new arrangements will also assist the Marshall Islands' revenue authorities to implement the TIEA through the provision of technical assistance and training to be delivered by the Australian Tax Office.
These agreements will enter into force after both countries have completed their relevant domestic requirements. Copies of the agreements can be found at www.treasury.gov.au.