Hong Kong/Latvia tax treaty sets low withholding rates, text available

Hong Kong and Latvia on March 13 signed a tax treaty and protocol in Riga.

The agreement, which is not yet in force, reduces withholding taxes on dividends and interest to zero if the beneficial owner of the payment is a company, and to 10 percent in other cases. Listed governmennt organizations are exempt from withholding.

Under the agreement, withholding taxes on royalties are reduced to zero if the beneficial is a company; withholding on royalties is three percent in other cases.

The treaty also provides rules determining which country can tax capital gains and income from employment, provides a mutual agreement procedure for tax treaty disputes, and includes provisions on exchange of information relating to taxes.

The agreement will enter into force after the countries have notified each other that the necessary domestic procedures to bring the agreement into force been completed.

See:

• Treaty