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ECONOMY | Staff Reporter, Hong Kong

Hong Kong inks tax pact with Finland

The deal states the allocation of taxing rights between jurisdictions.

Secretary for Financial Services & the Treasury James Lau and Finnish Consul-General Jari Sinkari have signed an agreement for the avoidance of double taxation.

The document sets out the allocation of taxing rights between the two jurisdictions to assist investors in evaluating their potential tax liabilities from cross-boundary economic activities.

Under the agreement, any Finnish tax paid by Hong Kong companies will be allowed as a credit against the tax payable in Hong Kong on the same profits, subject to the provisions of Hong Kong tax laws. For Finnish companies, the tax they pay in Hong Kong will be allowed as a deduction from the tax payable on the same income in Finland.

The agreement will come into force after the completion of ratification procedures on both sides.

It is the 40th tax agreement Hong Kong has signed with its trading partners, including the 16 member states of the European Union.

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