On Friday August 19th, 2016, Trinidad and Tobago signs inter-governmental FATCA agreement with US. The agreement’s type is a Model I Inter Governmental Agreement (IGA), which is designed to improve international tax compliance through mutual assistance in tax matters based on an effective infrastructure for the automatic exchange of information. Generally in Model I IGA, financial institutions provide financial data to the local Tax Authority in their country and the Tax Authority submits all the account data for all the financial institutions to the United States based on the requirements of IGA.
According to press release of Ministry of Finance the Rep. of Trinidad and Tobago and the United States of America will now move to bring the IGA into force. This would allow for the automatic exchange of information between both countries and also ensure that foreign financial institutions, including local banks and insurance companies, will not be subject to a thirty percent (30%) withholding.
The signing was completed before September 30 deadline set for the exchanging of information between both countries.