Global Tax Alert Panama is removed from Colombia’s recently issued

24 October 2014
Global Tax Alert
News from Americas Tax Center
EY Americas Tax Center
The EY Americas Tax
Center brings together
the experience and
perspectives of over
10,000 tax professionals
across the region to
help clients address
legislative and regulatory
opportunities and
challenges in the 33
countries that comprise
the Americas region of the
global EY organization.
• Copy into your web
Panama is removed from
Colombia’s recently issued
list of tax havens
On 21 October 2014, Panama and Colombia signed a memorandum of understanding
(the MOU) to cooperate on the exchange of tax information and money laundering
matters, resulting in the removal of Panama from Colombia’s recently issued list of
tax havens.1
Panama’s recent inclusion2 in Colombia’s list of tax havens generated a strong and
negative reaction from the Panamanian Government and business community.
Inclusion in Colombia’s list of tax havens, which is updated every year, means, for
example, that: (1) payments to tax havens that are considered to be Colombiansource income are subject to a withholding tax rate of 33%; (2) transactions between
Colombian residents and entities in tax havens must comply with transfer pricing
rules to ensure the deduction of related payments for Colombian corporate tax
purposes; and (3) Colombian citizens with residency in a tax haven are deemed to
be tax resident in Colombia.
This MOU is part of an undertaking by both countries to negotiate and conclude a
double taxation treaty comprising a provision for the exchange of information in line
with Organisation for Economic Co-operation and Development (OECD) standards
by no later than 30 September 2015.
1. Confirmed by Decree 2095 of 2014 issued by Colombia’s Ministry of Treasury
and Public Credit on 21 October 2014, which modifies Decree 1966 of 2014 and
expressly excludes Panama from the list of tax havens for Colombian purposes.
2. Decree 1966 of 2014 issued by Colombia’s Ministry of Treasury and Public
Credit on 6 October 2014.
For additional information with respect to this Alert, please contact the following:
Ernst & Young Ltda., Bogotá, Colombia
• Diego Casas
+57 1 484 7050
• Ricardo Ruiz
+57 1 484 7537
• Carlos Parra
+57 1 484 7931
[email protected]
[email protected]
[email protected]
Ernst & Young Limited Corp., Panama City, Panama
• Luis Eduardo Ocando
+507 208 0144
• Carlos A. Marquez González
+507 208 0146
• Klaus Bieberach
+507 208 0165
[email protected]
[email protected]
[email protected]
Ernst & Young, S.A., San José, Costa Rica
• Rafael Sayagues
+506 2208 9880
• Alexandre Barbellion
+506 2208 9841
[email protected]
[email protected]
Global Tax Alert Americas Tax Center
EY | Assurance | Tax | Transactions | Advisory
About EY
EY is a global leader in assurance, tax, transaction and advisory
services. The insights and quality services we deliver help build trust and
confidence in the capital markets and in economies the world over. We
develop outstanding leaders who team to deliver on our promises to all
of our stakeholders. In so doing, we play a critical role in building a better
working world for our people, for our clients and for our communities.
EY refers to the global organization, and may refer to one or more, of
the member firms of Ernst & Young Global Limited, each of which is a
separate legal entity. Ernst & Young Global Limited, a UK company limited
by guarantee, does not provide services to clients. For more information
about our organization, please visit
Americas Tax Center
© 2014 EYGM Limited.
All Rights Reserved.
EYG No. CM4829
This material has been prepared for general informational purposes only and is not intended to
be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for
specific advice.