February 25, 1985
To the Senate of the United States:
I transmit herewith, for Senate advice and consent to ratification, the Convention between the United States of America and Barbados for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income (``the Convention''), together with an exchange of notes, signed at Bridgetown on December 31, 1984. I also transmit the report of the Department of State on the Convention.
The Convention, in general, follows the pattern of other United States income tax treaties and the current draft United States Model Income Tax Convention, but deviates from the model in certain respects to reflect Barbados' status as a developing country.
Among the principal features of the Convention are provisions to prevent third-country residents from taking unwarranted advantage of the treaty. The Convention also establishes maximum rates of tax at source on payments of dividends, interest, and royalties.
The exchange of notes indicates the willingness of the United States Government to reopen discussions, should circumstances change, which would permit the inclusion of additional provisions to create incentives to promote the flow of United States investment to Barbados.
I recommend that the Senate give early and favorable consideration to this matter, and give advice and consent to ratification of the Convention, together with the related exchange of notes.
Ronald Reagan
The White House,
February 25, 1985.