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MPs will discuss and vote on a major legislative step to deepen the kingdom’s participation in global tax transparency systems.
They are set to approve a draft law allowing accession to the Annex of the Multilateral Competent Authority Agreement on the Automatic Exchange of Financial Account Information.
The move aligns Bahrain with updated international standards issued by the Organisation for Economic Co-operation and Development (OECD), particularly the 2023 revisions to the Common Reporting Standard (CRS), which now extend reporting requirements to digital assets and strengthen due diligence obligations across financial institutions.
The financial and economic affairs committee said the reform reflects Bahrain’s long-standing commitment to international co-operation on tax matters and strengthens its position within a rapidly evolving global financial system.
Committee vice-chairwoman MP Zainab Abdulamir stressed that the legislation is both a compliance requirement and a strategic economic safeguard.
“This step is not merely procedural. It is about ensuring Bahrain remains fully integrated into the global financial system, while protecting our economy from any risks linked to non-co-operation or lack of transparency,” she said.
She added that the updated framework ‘places Bahrain at the forefront of jurisdictions implementing advanced international tax standards, particularly those related to digital financial activity and cross-border information exchange’.
The draft law approves Bahrain’s accession to the annex attached to the multilateral agreement, which enhances the scope of information exchanged between tax authorities of participating countries.
This includes additional disclosures on account holders, joint accounts, and equity participation in investment entities, as well as expanded reporting on digital financial assets.
According to the Finance and National Economy Ministry, Bahrain’s participation builds on commitments made since joining the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes in 2010.
The kingdom signed the original CRS framework in 2017, with implementation beginning in 2018, and has since exchanged financial account data with dozens of partner jurisdictions.
Officials told Parliament that more than 160 jurisdictions are now committed to the CRS standard, making participation essential to avoid reputational or regulatory risks.
The latest amendments are expected to be fully implemented by 2027.
Ms Abdulamir said the update is necessary to keep pace with financial innovation.
“The global financial landscape has changed significantly with the rise of digital assets and fintech platforms. Bahrain must ensure its legal and regulatory systems evolve in parallel, or risk falling behind international standards,” she noted.
From a policy perspective, legislators said the agreement strengthens Bahrain’s global credibility, supports anti-tax evasion efforts, and ensures continued compliance with OECD and European Union expectations.
Meanwhile, the committee has also recommended a mutual taxation agreement with Saudi Arabia.
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