Colombia puts Pressure on Panama Over Tax Agreement

The inclusion of Panama in the Colombian government's gray list could mean surcharges on capital repatriation by investors in the country.

Friday, May 16, 2014

"If Panama is included on a (Colombia's) gray list, it will affect the Colombian investments that exist in Panama and which have a strong presence in banking and other industries, because they will pay a surcharge when they repatriate their profits," the outgoing Minister of Economy and Finance in Panama, Frank De Lima, said.

Dinero.com reports that "... the Panamanian Government which will on July 1 assume the office of the opposition leader and current vice-president, Juan Carlos Varela, must decide whether to sign the agreement to exchange tax information requested by Colombia.

De Lima said that they do not know "figure which is accurate regarding Colombian investment in Panama, but highlighted that in the financial sector 'Colombian banks account for nearly 25% of total assets.'"

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More on this topic

Panama's Response to Colombia's "Graylisting"

October 2014

The Panamanian government is giving Colombia a period of 7 days to retract and remove the country from the "gray list" so that it can then negotiate on equal terms.

From a statement issued by the Government of the Republic of Panama:

The Government of the Republic of Panama has given a period of seven days for the Colombian authorities to withdraw the country from the list of "tax havens" and so make way for negotiations between the two nations on equal terms.

Retaliation Against Colombia for "Graylisting"

October 2014

A call has been made for measures such as raising tariffs, creating taxes on remittances and removing the exemption from tolls on Colombian boats.

From a statement issued by the Panamanian Association of Business Executives (APEDE):

The Panamanian Association of Business Executives (APEDE) regrets the decision of the Colombian Government to categorize Panama as a "tax haven", which is an inappropriate and discriminatory description, because in Panama taxes are indeed paid and the taxation regime does not distinguish between nationalities, taxes are paid by nationals and foreigners in several forms: income tax, transactions of movable goods and services (ITBMS), and dividends, among others.

Colombia Includes Panama in Grey List

October 2014

Following the decision by the Colombian authorities, the costs of financial and tax transactions between the two countries will increase.

The absence of Panama's signing of an agreement to exchange tax information with Colombia has led authorities of that country to include Panama in the list of uncooperative countries. The main objective of Colombia "... is to close the doors for people hiding money in other countries."

Panama Could Go Back to OECD Gray List

March 2014

The Minister of Finance announced that the country did not pass the first stage of the review by the OECD because it has not implemented a law immobilizing bearer shares.

An assessment of tax transparency and exchange of information that would have been made by the Global Forum Organization for the OECD will prevent the country from being removed from the list of tax havens.

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