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Portugal's list of tax havens

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Under Ministerial Order n. 150/2004 of 13 February, issued by the Portuguese Ministry of Finance and consequently updated, Portugal defines an official blacklist of countries and jurisdictions considered for legal and tax purposes as tax havens.

Ministral Order n. 150/2004
Ministry of Finance
  • Ministral Order n. 150/2004 - Approves a list of countries, territories and regions with privileged tax regimes which are clearly more favorable
Territorial extentPortugal
Enacted byPortugal's Ministry of Finance
Signed byVasco Jorge Valdez Ferreira Matias
CommencedFebruary 13, 2004
Administered byPortuguese Tax and Customs Authority
Amends
Ministerial Order n.150/2004
Ministerial Order n. 292/2011
Ministerial Order n. 345-A/2016
Ministerial Order n. 309-A/2020
Related legislation
Personal Income Tax Code
Corporate Income Tax Code
Municipal Property Tax Code
Municipal Property Transfer Tax Code
Stamp Duty Tax Code
Tax Benefits Statutes
Summary
Approves the official list for legal and tax purposes of jurisdictions deemed as tax havens.
Keywords
Tax Havens, Offshore Financial Centre
Status: In force

Blacklisted Jurisdictions

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Current Blacklisted Jurisdictions

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Blacklisted Jurisdiction Type Notes
 Anguilla British Overseas Territory -
 Antigua and Barbuda Country -
 Netherlands Antilles Constituent Country The Netherlands Antilles were dissolved in 2010.
 Aruba Constituent Country -
 Saint Helena, Ascension and Tristan da Cunha British Overseas Territory -
 Bahamas Country
 Bahrain Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[1]
 Barbados Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[2]
 Belize Country -
 Bolivia Country -
 Brunei Country -
 Costa Rica Country -
 Fiji Country -
 Maldives Country -
 Northern Mariana Islands Commonwealth -
 Marshall Islands Country -
 Mauritius Country -
 Monaco Country -
 Christmas Island Australian external territory -
 Palau Country -
 Solomon Islands Country -
 Svalbard and Jan Mayen Unincorporated internal area of Norway Portugal has signed an Agreement to Avoid Double Taxation with the country but the agreement does not include these territories.[3]
 Turks and Caicos Islands British Overseas Territory -
 British Virgin Islands British Overseas Territory -
 United States Virgin Islands Unincorporated and organized U.S. territory -
 Jamaica Country -
 Jordan Country -
 Kuwait Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[4]
 Djibouti Country -
 Dominica Country -
 United Arab Emirates Country Portugal has signed an Agreement to Avoid Double Taxation with the country.
 Gambia Country -
 Gibraltar British Overseas Territory Portugal has signed an agreement of exchange of tax information with the territory.
 Grenada Country -
 Guyana Country -
 Honduras Country -
 Hong Kong, China Special Administrative Region Portugal has signed an Agreement to Avoid Double Taxation with the territory.[5]
 Guam Unincorporated and organized U.S. territory Portugal has signed an Agreement to Avoid Double Taxation with the country.[6]
 Kiribati Country -
 Isle of Man Crown dependency Portugal has signed an agreement of exchange of tax information with the territory.[7] The Isle of Man was briefly whitelisted between January 1, 2017 and December 31, 2018.
 Niue Country -
 Pitcairn Islands British Overseas Territory -
 Iran (Qeshm Island) County Only the county of Qeshm, more specifically the island of Qeshm has been blacklisted by the Portuguese government.[7]
 Saint Pierre and Miquelon Overseas collectivity of France Portugal has signed an Agreement to Avoid Double Taxation with the country but the agreement does not include this territory.[8]
 Tokelau Dependent territory of New Zealand -
 Norfolk Island Australian external territory -
 Labuan Malaysian Federal Territory -
 Lebanon Country -
 Liberia Country -
 Liechtenstein Country -
 Mauritius Country -
 Monaco Country -
 Montserrat British Overseas Territory -
 Nauru Country -
 Panama Country -
 French Polynesia Overseas country and collectivity of France Portugal has signed an Agreement to Avoid Double Taxation with the country but the agreement does not include this territory.
 Puerto Rico U.S. Commonwealth and Unincorporated and organized U.S. territory Portugal has signed an Agreement to Avoid Double Taxation with the country.[6]
 Qatar Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[9]
 Yemen Country -
 Vanuatu Country -
 American Samoa Unincorporated and unorganized U.S. territory Portugal has signed an Agreement to Avoid Double Taxation with the country.[6]
 Samoa Country -
 Saint Lucia Country -
 Saint Kitts and Nevis Country -
 San Marino Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[10]
 Tuvalu Country -
 Bermuda British Overseas Territory Portugal has signed an agreement of exchange of tax information with the territory.[7]
 Cayman Islands British Overseas Territory Portugal has signed an agreement of exchange of tax information with the territory.[7]
 Cocos (Keeling) Islands Australian external territory -
 Cook Islands Country -
 Guernsey Bailiwick Portugal has signed an agreement of exchange of tax information with the territory.[7]
 Jersey Bailiwick Portugal has signed an agreement of exchange of tax information with the territory.[7]
Other Pacific Islands Non-specified The Portuguese Government considered "other Pacific Islands" all the islands in the Pacific Ocean not mentioned in the list.
 Falkland Islands British Overseas Territory -
 Saint Vincent and the Grenadines Country -
 Seychelles Country -
 Eswatini Country -
 Oman Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[11]
 Tonga Country -
 Trinidad and Tobago Country -
 Uruguay Country Portugal has signed an Agreement to Avoid Double Taxation with the country.[12] Uruguay was briefly whitelisted between January 1, 2017 and December 31, 2018.

Former Blacklisted Jurisdictions

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Jurisdiction Type Date of Whitelisting Notes
 Andorra Country January 1, 2021 Portugal has signed an agreement of exchange of tax information and an Agreement to Avoid Double Taxation, in force since April 23, 2017, with Andorra.[13]

The Government of the Principality of Andorra sent a formal request under Article 63d(3) of the Portuguese General Taxation Law to review the country's place on the Portuguese blacklist, which was then subject of a positive opinion issued by the Portuguese Tax and Customs Authority, and the conditions for excluding the Principality of Andorra from the blacklisted were approved by the Ministry of Finance.[14][15][16]

 Cyprus EU Member State November 9, 2011 Portugal has signed an agreement of exchange of tax information and an Agreement to Avoid Double Taxation, in force since August 16, 2013, with Cyprus.[17] Under EU Law Portugal could not discriminate fellow Member-States nor prevent the free movement of capital.[18]
 Luxembourg

Sanctions

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National sanctions

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The Portuguese Tax Code foresees aggravated withholding tax, 35% tax rate, on capital income (interests and dividends) deriving from black listed jurisdictions and an aggravated municipal property tax of 7% on property owned by entities located in said jurisdiction. Portugal's "blacklist" is defined by decree issued by the Minister of Finance and taking into account confidential reports issued by the Portuguese Tax and Customs Authority.

In addition, non-habitual residents (NHRs) status holders do not benefit from personal income tax exemption on interests, dividends, capital gains, income from immovable property (rents), royalties, intellectual property income and business income) if: these are sourced from black-listed jurisdictions.[19] Therefore, taxation of such income will be subject to the normal rates or to the 35% rate depending on the type of income earned by the NHR status holder.

European Union Sanctions

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On December 16, 2019, the EU Code of Conduct Group (Business Taxation) (CCG), under the Economic and Financial Affairs Council, published a new guidance[20] on sanctions to be applied by EU Member States against blacklisted 'non-cooperative' jurisdictions by the end of 2020. These sanctions were immediately backed[21] by the Finish Presidency of the Council of the European Union who labelled them as "defensive-measures" that are recommended to EU Member States to take against blacklisted jurisdictions.[22] Implementation of such sanctions by Portugal are expected to occur on January 1, 2021.

Criticism

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The list has been said to have violated EU Law by discriminating against a former EU-Member State's territory such as Gibraltar, therefore violating the principle of free movement of capital. Furthermore, the list does not take into account whether Portugal has in place a double taxation agreement with the blacklisted territory.[23][24][25]

Critics also point out that the list is not clear[23][24] given the fact that it makes no provisions regarding the dissolution of the Netherlands Antilles nor if countries such as Japan, Australia or New Zealand fall under the category of "other Pacific Islands." In addition, the Portuguese list does not mirror the list adopted by the European Union regarding tax aggressive and non-cooperative jurisdictions.[26]

References

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  1. ^ "Resolução da Assembleia da República 196/2016, 2016-09-22". Diário da República Eletrónico (in Portuguese). Retrieved 2019-11-13.
  2. ^ "Convenção entre a República Portuguesa e Barbados para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em Matéria de Impostos sobre o Rendimento | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  3. ^ "Convenção entre Portugal e a Noruega para Evitar a Dupla Tributação em Matéria de Impostos sobre o Rendimento e sobre o Capital | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  4. ^ CCIAP. "CCIAP". CCIAP. Retrieved 2019-11-13.
  5. ^ "Acordo entre a República Portuguesa e a Região Administrativa Especial de Hong Kong da República Popular da China para Evitar a Dupla Tributação e... | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  6. ^ a b c "Convenção e o Protocolo entre a República Portuguesa e os Estados Unidos da América para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em... | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  7. ^ a b c d e f PricewaterhouseCoopers. "Tax havens". PwC. Retrieved 2019-11-13.
  8. ^ "Convenção entre Portugal e a França para Evitar a Dupla Tributação e Estabelecer Regras de Assistência Administrativa Recíproca em Matéria de... | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  9. ^ "Acordo entre a República Portuguesa e o Estado do Qatar para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em Matéria de Impostos sobre o... | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  10. ^ "Resolução da Assembleia da República 95/2014, 2014-11-13". Diário da República Eletrónico (in Portuguese). Retrieved 2019-11-13.
  11. ^ "Convenção entre a República Portuguesa e o Sultanato de Omã para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em Matéria de Impostos sobre o... | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  12. ^ "Convenção entre a República Portuguesa e a República Oriental do Uruguai para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em Matéria de... | Portal do Ministério Público - Portugal". www.ministeriopublico.pt. Retrieved 2019-11-13.
  13. ^ "Convenção entre a República Portuguesa e o Principado de Andorra para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em Matéria de Impostos sobre o Rendimento". Ministério Público. Retrieved February 4, 2021.
  14. ^ "Andorra removed from blacklist | Madeira Corporate Services". 7 January 2021. Retrieved 2021-02-04.
  15. ^ Crisóstomo, Pedro (January 2021). "Portugal retira Andorra da "lista negra" de paraísos fiscais". PÚBLICO (in Portuguese). Retrieved 2021-02-04.
  16. ^ Lusa, Agência. "Portugal retirou Andorra da lista de paraísos fiscais". Observador (in European Portuguese). Retrieved 2021-02-04.
  17. ^ "Convenção entre a República Portuguesa e a República de Chipre para Evitar a Dupla Tributação e Prevenir a Evasão Fiscal em Matéria de Impostos sobre o Rendimento". Ministério Público. Retrieved February 4, 2021.
  18. ^ "Portaria 292/2011, 2011-11-08". Diário da República Eletrónico (in Portuguese). Retrieved 2021-02-04.
  19. ^ "Non-Habitual Resident (NHR) Regime - MCS". mcs.pt. Retrieved 2020-04-01.
  20. ^ "Report 14114/19 from the Code of Conduct Group (Business Taxation)". Council of the European Union. December 25, 2019. Retrieved December 17, 2019.
  21. ^ "EU to roll out sanctions against blacklisted jurisdictions". www.internationalinvestment.net. 2019-12-17. Retrieved 2019-12-18.
  22. ^ Lintilä, Mika (December 5, 2019). "OUTCOME OF THE COUNCIL MEETING - 3736th Council meeting" (PDF). Council of the European Union. Retrieved December 18, 2019.
  23. ^ a b "Hipocrisia Tributária". JM Madeira (in European Portuguese). 2019-08-01. Retrieved 2019-11-13.
  24. ^ a b "Problemas de uma Lista Negra". O Jornal Económico (in European Portuguese). 2017-08-01. Retrieved 2021-02-05.
  25. ^ "Portugal, a Venezuela da Europa". JM Madeira (in European Portuguese). 2021-01-14. Retrieved 2021-02-05.
  26. ^ "Offshore Company Formation". www.tba-associates.com. April 2015. Retrieved 2021-08-21.
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