Nicosia, Cyprus. The Republic of Cyprus on Friday signed an agreement with the government of the Hong Kong Special Administrative Region of the People’s Republic of China to eliminate double taxation on income and combat tax evasion and tax avoidance.
The finance ministry said the agreement establishes a modern framework for tax cooperation expected to support business activity, investment flows and trade transactions.
Agreement framework
According to the finance ministry, the agreement creates a modern and reliable framework for tax cooperation. It said the arrangement is expected to facilitate business activity and strengthen investment flows as well as trade transactions.
The ministry added that the agreement will help reduce the overall burden by encouraging sustainable investments, without creating opportunities for tax evasion or tax avoidance, while ensuring legal certainty.
Tax treatment and information exchange
According to the announcement, the bilateral agreement provides for clear tax treatment of transactions between the two jurisdictions, offering certainty and stability for investors.
The convention also provides for the exchange of tax information between the competent authorities and establishes procedures for the settlement of tax disputes.
Government statement
The ministry said the signing reflects the importance attached by the government to the development of strong economic and political ties with international financial and commercial centres, particularly with partners such as Hong Kong.
It added that the agreement strengthens prospects for cooperation in an evolving global economic environment.
Signatories
The ministry said the agreement was signed on behalf of the Republic of Cyprus by Ambassador to the People’s Republic of China Koula Sophianou.
She was accompanied by Cyprus’ Honorary Consul in Hong Kong Harindarpal Singh Banga.
On behalf of the Hong Kong Special Administrative Region of the People’s Republic of China, the agreement was signed by Financial Services and the Treasury Secretary Christopher Hui.