Hong Kong Falls Into Line With OECD
Friday, January 08, 2010
Although Hong Kong has a limited number of tax treaties, the wording they contain
allowing exchange of tax information falls short of the OECD's current standards,
which has led a number of other possible treaty partners to delay treaty negotiations
with the SAR, and has caused the OECD to put pressure on Hong Kong to conform.
Now the government has passed an amendment to the Inland Revenue Ordinance
introducing a new section, 49.1(A), which allows the Chief Executive to authorize
treaties or agreements made with other countries which include wording in conformity
with the current OECD standard, meaning in effect that exchange of information
can take place without there being a domestic Hong Kong reason for it. The law
allows tax officials to seize information from persons regarding their tax liabilities
in other states with which Hong Kong has agreements containing such wording.
The government says that it has listened to concerns regarding professional
privilege and confidentiality in arriving at the final wording of the amendment.
It can be expected that Hong Kong will now enter a flurry of tax treaties and
TIEAs, and it may be that the SAR will be included in future agreements entered
into by mainland China. |
Lowtax Network Portal