Brazil signs treaties with Norway and the UK to eliminate double taxation on income

Agreements also aim to prevent tax evasion and expand trade and investment flows among the signatory countries

In November, Brazil signed Double Taxation Agreements (DTAs) with the United Kingdom and Norway, two important members of the Organization for Economic Cooperation and Development (OECD).

Aimed at curbing double taxation on income and expanding bilateral trade and investment flows, the treaties signed by Brazil reflect the country’s efforts to join the OECD and maintain close ties with the world’s largest economies.

By strengthening cooperation between the tax authorities of the nations involved, the TDAs entered into provide greater tax predictability to businesses and help tackle tax evasion through the exchange of information among the signatory countries.

In addition to providing relief from double taxation on income and from taxation of dividends, interest, royalties and remuneration for technical services, the TDAs have also introduced other innovations, including most favored nation (MFN) clauses. This means that if Brazil adopts lower tax rates for other OECD members (excluding Latin American countries), such rates will also apply in relation to the treaties’ parties, thus helping reduce economic burdens while increasing Brazil's competitiveness in the global market.

With regard to Norway, the new convention will replace the agreement currently in force, signed in the 1980s, bringing its terms up to date with modern standards.

It should be noted that international agreements need to be approved and enacted under each country's domestic law before they can be brought into force.