Jersey Removed From Portuguese Blacklist
by Jason Gorringe, Lowtax.net, London
13 January, 2017
Jersey has been removed from Portugal's list of privileged tax regimes, following the signing of a decree by the Portuguese Minister of Finance, Mario Centeno.
The removal of Jersey from the blacklist means that special anti-abuse measures laid down in Portuguese law no longer apply. These measures include a presumption that parties are related for the purposes of transfer pricing rules, limitations on the deductibility of expenses, and a ban on using the exemption method to eliminate double taxation on certain kinds of business and professional income.
Jersey Finance, the islands' business promotion agency, said the decision by Portugal was based on Jersey's strong track record of transparency and cooperation.
This includes signing a Tax Information Exchange Agreement with Portugal, agreeing to implement the Common Reporting Standard on the automatic exchange of Information, and Jersey's "largely compliant" rating by the Global Forum on Transparency and Exchange of Information for Tax Purposes.
It also follows representations made by the Minister for External Relations, Philip Bailhache, and his team, both to the Portuguese Embassy in London and to the Minister of Finance in Lisbon.
Commenting on Portugal's decision, Bailhache said: "I am very pleased that we have reached agreement with the Portuguese authorities on Jersey's removal from the blacklist. This is the right outcome given Jersey's commitment to tax exchange and mutual assistance, and follows sustained discussions between the Ministry of External Relations and our counterparts in the Portuguese government. It will encourage business links between Jersey and Portugal."
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