FROM THE OFFICE OF PUBLIC AFFAIRS

The Treasury Department announced today that the United States and Antigua and Barbuda have exchanged diplomatic notes that bring into force the agreement for exchange of information with respect to taxes between the two countries that was signed in Washington, DC, on December 6, 2001 (the “Agreement”).  The Agreement entered into force as of February 10, 2003, and is effective as of that date.

The Agreement satisfies the criteria set forth in the Caribbean Basin Economic Recovery Act of 1983 and is consistent with the standards for an exchange of information agreement described in section 274(h)(6)(C) of the United States Internal Revenue Code of 1986, as amended (relating to deductions for attendance at foreign conventions).  Antigua and Barbuda therefore is now considered part of the “North American area” for purposes of determining whether U.S. taxpayers may deduct expenses incurred in attending conventions, business meetings and seminars there.  Convention expenses incurred by U.S. taxpayers for meetings in Antigua and Barbuda that otherwise are deductible as ordinary and necessary business expenses will be allowed without regard to the additional limitations applicable to foreign convention deductions.  A list of other geographical areas that similarly are included in the North American area for purposes of the convention expense deduction is provided in Revenue Ruling 94-56, and this revenue ruling will be updated to take into account the agreement with Antigua and Barbuda.