The Republic of Panama has signed over 10 tax information exchange agreements (TIEA) with countries such as Canada, Finland, Denmark, the US, and Japan, eight of which are in force. The majority of Panama's signed TIEAs contain an exchange of information clause upon request.
Due to recent commitments undertaken by Panama as a consequence of the international pressure that has been exerted upon the country, Panama has signed and legally enacted a TIEA with Japan, which contains an international standard automatic exchange of information clause.
By virtue of this agreement, Panama implemented for the first time the parameters of the common reporting standard (CRS) developed by the OECD. Through this agreement, Panama pledged to an automatic exchange of information on a bilateral basis, complying with its international commitment to implement such a standard in order to strengthen international tax transparency.
Panama has confirmed that the automatic exchange of information with Japan will commence in 2018. Nevertheless, the specific date is yet to be confirmed.
It is important to recognise that Panama has also enacted law 51 of 2017 which establishes a legal framework for the application of the exchange of information for tax purposes. This law imposes certain obligations and controls appropriate for the supervision of and compliance with the agreements that Panama has executed and which are already in force.
Panama has also signed and legally enacted the Convention on Mutual Administrative Assistance in Tax Matters (MAT). The signing of this agreement has also been influenced by Panama's efforts to strengthen the transparency on the financial and legal services rendered in the country.
The MAT has established a legal platform that will permit competent government authorities to sign and execute agreements for the implementation of an automatic exchange of information. In this respect, Panama has already confirmed the execution of an agreement with the tax authorities of Mexico and Germany. These automatic exchanges of information will commence in 2018.
The Panamanian tax authority also intends to negotiate and sign agreements for the automatic exchange of information with the competent authorities in Spain, Italy, Germany, Japan, Norway, Canada, the UK and Switzerland.
|Anna C Valdés|
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