Friday, 10 February 2012

Tax Transparency- Hong Kong’s position on double tax agreements

In January, a seminar was given by the IRD and the Global Forum on Tax Transparency, updating Hong Kong’s position on double tax agreements (DTAs).

Hong Kong has now signed 22 DTAs, most of them in 2010 and 2011, of which at least 14 will be in effect in or from 2012. The remainders are either still to be ratified or the implementation date is set for beyond

A key point made by the Global Forum speaker was that Hong Kong law does not currently permit the entering into of tax information exchange agreements (TIEAs). Thus, tax information exchange can only
take place through a DTA. This is likely to delay the signing of DTAs with, for example, the US, Australia and the Nordic countries, which have a preference for separate TIEAs.

Whilst Hong Kong has never been on the OECD/FATF tax blacklist, there is now some pressure on Hong Kong to amend its law on TIEAs (to allow them) so as not to appear a “freeloader” in the international tax system.

Primasia will post the updates of Hong Kong and China from time to time. Follow us on our WebsiteBloggerLinkedIn and stay tunned for our updates!

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