(OECD) 2018 Progress Report on Preferential Regimes Has Found the Curaçao Tax Regimes Not to Be Harmful

Newsflash OECD report on Curaçao tax regimes

The Organization of Economic Cooperation and Development (OECD) 2018 Progress Report on Preferential Regimes has found the Curaçao tax regimes not to be harmful.

The OECD released a new publication on January 29, 2019, called “Harmful Tax Practices - 2018 Progress Report on Preferential Regimes”. The results show that jurisdictions have delivered on their commitment to comply with the standard on harmful tax practices, including their guarantee that preferential regimes align taxation with substance.

The 2018 Progress Report on Preferential Regimes contains new conclusions on 57 regimes based on the assessment of preferential tax regimes comprising more than 120 member jurisdictions of the Inclusive Framework.

Curaçao tax regimes

Curaçao has amended three preferential regimes considered to be harmful (the exempt company regime, the export facility and the economic zone), and it has introduced the innovation box regime.

The Forum on Harmful Tax Practices (FHTP) has assessed the amendments and the conclusion was as follows: the Curaçao Investment Company is not harmful, the innovation box is not harmful, the economic zone is out of scope, and the export regime has been abolished.

The Curaçao Investment Company

The exempt company has been replaced with the Curaçao Investment Company, which has been assessed to be “not harmful”. This means amendments have been taken into account to ensure the removal of harmful features. The report also mentions that substance requirements are in place and that no grandfathering is provided.

The Innovation Box Regime

The Innovation Box Regime was designed in compliance with FHTP standards and has been assessed to be “not harmful”. This means the regime is in scope.

The Economic Zone

The Economic Zone was amended and no longer grants tax benefits to geographically mobile activities. The FHTP assessed the regime of the Economic zone to be out of scope. It is no longer a preferential regime.

The purpose of this newsflash is to inform you about recent developments. It is not a substitute for any professional advice or services, nor should it be used as a basis for any decision or action that may affect your finances or your business. We advise you to consult a qualified professional adviser CONTACTS before making any decision or taking any action that may affect your finances or your business. For more information please Please contact our office at the email addresses mentioned in this contact: newsflash if you have any questions about the amendments or need additional information. Julian Lopez Ramirez Managing Partner Tax Advisory We would be pleased to assist you with your questions. Services Office phone: +5999 433 3346 Mobile phone: +5999 690 8622 [email protected]

Monique Dap Senior Manager Tax Advisory Services Office phone: +5999 433 3343 Mobile phone:+5999 690 8624 [email protected]

Vivian Pieters Senior Manager Tax Accounting and Compliance Services

Office phone: +5999 433 3312 Mobile phone:+5999 670 6571 [email protected]

Claire Godschalk Manager Tax Advisory Services Office phone: +5999 433 3319 Mobile phone:+5999 685 0078

Legal Jurisdiction [email protected] Any dispute or other legal matter resulting from this correspondence shall be governed by the jurisdiction of the Common Court of Justice of Aruba, Curaçao, Sint Maarten and of Bonaire, Sint Eustatius and Saba. Sharon Eliazer Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member Junior Manager Tax Accounting firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not and Compliance Services provide services to clients. Please see http://www.deloitte.com/about to learn more about our global network of member firms. Office phone: +5999 433 3325 Mobile phone:+5999 690 8614 Deloitte Dutch Caribbean is part of the Deloitte Network. In the Dutch Caribbean the services are provided [email protected] by Deloitte Dutch Caribbean, an entity which is registered with the trade register in Curaçao under number 34292, in Aruba under number 42205.0 and in Bonaire under number 9629 (0).