First step to eliminate Hong Kong from the list of Tax Heavens
18 of June
On May 31, 2024, the Colombian Tax Office (“DIAN”), through Resolution 96, issued the periodic report of those jurisdictions that, as of December 31, 2023, have signed an international treaty or agreement that allows the effective exchange of information with Colombia. Within the list of jurisdictions enunciated by the DIAN, Hong Kong is found.
The purpose of Resolution 96 is for the National Government to have the necessary elements of judgment to review the list of tax havens, so as to determine whether to exclude any of the jurisdictions from the list.
With this, all that remains is for the National Government to issue a Ruling removing Hong Kong from the list of Tax Havens.
It is relevant to clarify that, although the National Government does not have a specific period to issue the aforementioned Ruling, it is evident that, in the past, the time that has elapsed between the DIAN Resolution and the National Government Ruling has been extremely short.
To illustrate the above, we call to your attention, that when it was decided to remove Barbados, the United Arab Emirates, Monaco and Panama from the list of Tax Havens, the DIAN Resolution 8917 came out on the same day as Ruling 2095 of the National Government (October 21, 2024).
With this in mind, it is expected that the Ruling excluding Hong Kong from the list of Tax Havens will be issued soon.
This is positive news since, when the Ruling that excludes Hong Kong from the list of Tax Havens has been issued, transactions with this jurisdiction will not necessarily have to be subject to the transfer pricing regime, nor will the maximum withholding tax rate contemplated for payments made to those jurisdictions that are on the list of Tax Havens have to be applied.
If you have any questions regarding the scope and application of the particular case, please do not hesitate to contact us.
