Guernsey has signed a Double Taxation Arrangement (DTA) with Luxembourg
It means that Guernsey has now signed 'full' DTAs with eight jurisdictions. In addition to this DTA with Luxembourg, Guernsey has had a DTA with the UK for many years and has signed DTAs with Malta, in 2012, and earlier this year with the Isle of Man, Jersey, Qatar and Singapore as well as Hong Kong last month.
Gavin St Pier, Guernsey's Treasury and Resources Minister, signed the bilateral DTA with Luxembourg on Friday 10th May in London with Luxembourg's Chargé d'Affaires to the UK, Ms Béatrice Kirsch. The Treasury and Resources Minister said: "This is an important further component in Guernsey's network of tax agreements. Following on so closely from the signing of our DTA with Hong Kong, it is further demonstration of Guernsey meeting the highest global standards of international tax co-operation."
Fiona Le Poidevin, Chief Executive of Guernsey Finance - the promotional agency for the Island's finance industry, added: "There is already a strong link between Guernsey and Luxembourg in relation to financial services business and this is particularly the case with investment funds, where many platforms will have structures in both jurisdictions. The DTA means that individuals or companies with 'home' as one jurisdiction but with interests in the other jurisdiction will have mechanisms in place to prevent them from being taxed by both sets of authorities on the same income. This clarity and certainty on matters of taxation will make it even more attractive to conduct business between the two jurisdictions."
Rob Gray, Guernsey's Director of Income Tax, said: "This DTA will create a mechanism for alleviating double taxation and exchanging tax information with Luxembourg relating to both corporate and personal incomes. It also means that Guernsey's network of agreements continues to cover the majority of EU Member States and G20 countries."
In addition to agreements with major international finance centres such as Luxembourg, Guernsey is continuing to conclude Tax Information Exchange Agreements (TIEAs) with developing economies in order to assist them in protecting their tax revenues.
While in London, the Treasury & Resources Minister signed a TIEA with Botswana at the Botswanan High Commission, and a further TIEA, with Swaziland, is expected to be concluded in the near future. Together, the TIEAs with Botswana and Swaziland will take the number signed by Guernsey to a total of 43.
The Treasury and Resources Minister said: "Guernsey's tax team has built strong relationships with Southern African Development Community countries, including Botswana and Swaziland, over the past couple of years. The OECD's Global Forum has emphasised the importance of working with developing countries to share expertise on tax information exchange, thereby helping them to protect their tax revenues."
Mr Gray commented: "In October 2011, Ron van der Merwe, the Chair of the Tax Agreements Working Group of the SADC, said that the negotiation of tax agreements between SADC Member States and Guernsey was 'a major step forward in creating the basis for exchange of information for SADC members'. The conclusion of agreements with Botswana and Swaziland shows that Guernsey retains a strong commitment to working with and sharing best practice with SADC members and other developing economies."
For more information about Guernsey's finance industry please visit www.guernseyfinance.com.
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