Hong Kong and the US sign tax information agreement
On March 25 Hong Kong SAR signed an agreement with the US Government for exchange of information (EoI) relating to taxes.
This is the first tax information exchange agreement (TIEA) signed by Hong Kong, after the legal framework for entering into TIEAs with other jurisdictions was put in place in July 2013. TIEAs provide for exchange of information by the Inland Revenue Department (IRD) upon request made by another jurisdiction in relation to the assessment or enforcement of tax matters.
TIEAs provide for EoI on a stand-alone basis instead of being included as part of the comprehensive agreements for avoidance of double taxation (CDTAs). The TIEA will become effective after necessary legislative procedures and subject to negative vetting by the Legislative Council.
The TIEA paves the way for the EoI provision under the US Foreign Account Tax Compliance Act (FATCA). Meanwhile, Hong Kong is in discussions aimed at achieving a FATCA Model 2 Intergovernmental Agreement (IGA) with the US.
Click here to read the full press release.