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Monaco: Double Tax Treaties

Introduction

Monaco has double tax treaties with Luxembourg and Qatar which came into force in May and June 2010 respectively. A treaty with St Kitts and Nevis entered into force on 1 December 2011. DTAs with the Seychelles and Mali have been signed but are not yet in force. A treaty with France, which forms part of the 1963 portmanteau agreement between France and Monaco, is not a double taxation treaty in the traditional sense. It provides for income tax to be levied against French nationals who have or will transfer their residence to Monaco (see Personal Taxation), the imposition of business profits taxes on certain categories of companies and the exchange of information.

The tax treaty between the two territories was modified in October 2001 'to correct abnormal evolutions in the deduction of executive pay from Monaco's tax on corporate profits'. This included a decision to ensure that French citizens living in Monaco since 1989 must pay a wealth tax from the beginning of 2002 onwards.

Monaco was identified as a 'tax haven' by the OECD in 2000 and included in an OECD list of uncooperative tax havens issued in 2002 after failing to join other financial centres in committing formally to take steps towards increased transparency and exchange of information.

Back in February 2008, Prince Albert II of Monaco reportedly gave a commitment to Germany that the jurisdiction will cooperate in the sharing of information for tax purposes.

"The Prince gave his agreement to cooperation between the German and Monaco authorities as well as improved data exchange in the fight against tax fraud, money laundering and corruption," a German government spokesman told AFP.

Finance Minister Gilles Tonelli revealed to a news conference at the time that: "Monaco does not intend to distance itself from a general movement of information exchange as long as it is really applied by everyone."

Prince Albert has made it his priority to clean up Monaco's image as a 'secretive tax haven,' telling France's TF1 in 2008 that: "We must absolutely free ourselves of this equation that Monaco equals laundering."

In May 2008, French President Nicolas Sarkozy announced the upcoming ratification of Franco-Monegasque agreements and conventions concerning administrative cooperation, judicial assistance and investor security. This was completed on May 31.

Following negotiations with the OECD, Monaco agreed in early 2009 to increase its transparency with foreign tax authorities in the hope that the OECD will remove it from its list of uncooperative jurisdictions. The Monaco government said that it was following "recent evolutions in the area of bank secrecy and information exchange" undertaken by jurisdictions such as Switzerland, Luxembourg and Austria. Indeed, Monaco, along with Andorra and Liechtenstein, was removed from the OECD list of uncooperative jusdictions in May 2009. Since then, Monaco has signed 20 Tax Information Exchange Agreements.

The Principality of Monaco also stated that it is prepared to expand the scope of an anti-fraud agreement that it is negotiating with the European Commission so that the agreement incorporates the OECD standards fully.

Monaco expressed the hope that this agreement can be finalised by the end of 2009, so as to allow it to exchange information in all tax matters with all European Union member states that are signatories to the agreement. In addition, Monaco announced that it is prepared to negotiate tax information exchange agreements with all countries that wish to do so, and in particular with those members of the G-20 that are not also members of the EU.

Welcoming the announcement, OECD Secretary General Angel Gurría said: “The Principality of Monaco has made a very important step by recognising that in today’s financial world meeting international standards is no longer optional. Governments require it, customers require it, and competitors require it.”

Latest Monaco Treaty Updates

Treaty Update: Monaco - Liechtenstein
12 December, 2016
Monaco and Liechtenstein initialed a DTA on November 30, 2016.
Treaty Update: European Union - Monaco
26 October, 2016
The European Council on October 11 agreed a deal with Monaco to automatically exchange information on financial accounts.
Treaty Update: European Union - Monaco
08 March, 2016
The European Union and Monaco have initialed an automatic information exchange agreement.
Treaty Update: Guernsey - Monaco
04 June, 2015
Guernsey's DTA with Monaco entered into force on May 9, 2015.
Treaty Update: Guernsey - Monaco
06 May, 2015
Guernsey's DTA with Monaco will enter into force on May 9, 2015.
Treaty Update: Guernsey - Monaco
22 April, 2015
The DTA signed between Guernsey and Monaco will enter into force on May 9, 2015.
Treaty Update: United Kingdom - Monaco
01 April, 2015
The UK Government on March 19, 2015, tabled legislation in the House of Commons that would ratify the pending TIEA with Monaco.
Treaty Update: United Kingdom - Monaco
11 March, 2015
In an update on February 27, 2015, the UK Government confirmed that draft legislation has been forwarded to the House of Commons that would ratify the TIEA signed with Monaco.
Treaty Update: Italy - Monaco
10 March, 2015
Italy and Monaco signed a TIEA on March 2, 2015.
Treaty Update: Czech Republic - Monaco
05 August, 2014
The Czech Republic and Monaco signed a TIEA on July 31, 2014.
Treaty Update: Monaco - South Africa
07 October, 2013
Monaco and South Africa signed a Tax Information Exchange Agreement on September 23, 2013.
Treaty Update: Monaco - Mauritius
18 April, 2013
Monaco and Mauritius signed a DTA during a series of meetings during the weekend ending April 14, 2013, the Mauritius Government confirmed on April 17, 2013.
Treaty Update: Monaco - Spain
13 March, 2013
According to preliminary media reports, Monaco and Spain initialed a TIEA on March 6, 2013.
Treaty Update: Monaco - India
03 August, 2012
According to preliminary media reports, Monaco and India signed a TIEA on July 31, 2012.
Treaty Update: Monaco - Mali
23 February, 2012
According to preliminary media reports, Monaco and Mali signed a TIEA on February 13, 2012.
Treaty Update: Monaco - Iceland
23 February, 2012
According to preliminary media reports, the TIEA between Monaco and Iceland entered into force on February 23, 2012.
Treaty Update: Germany - Monaco
27 January, 2012
According to preliminary media reports, the TIEA between Germany and Monaco entered into force on December 9, 2011.
Treaty Update: Monaco - Various
28 November, 2011
According to preliminary media reports, the TIEAs signed by Monaco with Denmark and with the Faroe Islands, have entered into force.
Treaty Update: Austria - Monaco
16 August, 2011
According to Austria's Finance Ministry, the TIEA with Monaco entered into force on August 1, 2011. The TIEA was signed on September 15, 2009 and applies retroactively from January 1, 2011.
Treaty Update: Belgium - Monaco
19 July, 2011
According to preliminary media reports, the Belgian parliament ratified the TIEA with Monaco on July 7, 2011.
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