Panama: Panama Courted by Countries Seeking to Limit Double Taxation

Panama Courted by Countries Seeking to Limit Double Taxation

Story La Prensa

Panama is preparing to begin talks with four countries about the development of treaties to avoid double taxation, one of its strategies it hopes will convince the Organization for Economic Cooperation and Development (OECD) that it doesn't merit the "tax haven" label.

So far, the government has received concrete confirmation from Spain, Mexico, Holland and Italy on their readiness to negotiate the signing of such agreements.

Economic experts note that anti-double taxation treaties tend to offer great benefits to the contracting countries and their citizens.

Deputy Economy Minister Frank De Lima has said that the Chancellor received this week a draft treaty on the issue from Spain, a country which has long placed Panama on its "black list" for its banking industry's alleged lack of transparency.

Similarly, the official confirmed that negotiations are also advancing with Mexico, where meetings held by request of the OECD to discuss taxes got underway last month.

Double taxation occurs when two or more countries claim the right to tax the income of certain companies or individuals.

Should the current talks fo well, De Lima said that other countries such as Poland, France, Switzerland, Luxembourg, Belgium, San Marino and Canada have expressed interest in discussing double taxation treaties.

"The point is that we will sit down and talk with countries with which we have an important business relationship, and not because we are being lead by the requirements of the OECD," added De Lima.