The Supreme Decree provides the latest list of tax havens or non-cooperative jurisdictions and amends the conditions under which a country or jurisdiction will be added or removed from the list. It also provides new requirements for a country to be considered a preferential tax regime and expands the transfer pricing rules to transactions with entities subject to preferential tax regimes.

On December 30, 2018, Peru's Minister of Economics issued Supreme Decree 340-2018-EF, which contains regulations that include Peru's black list of countries and jurisdictions that are considered tax havens or non-cooperative jurisdictions, as well as conditions for being added or removed from the list. The regulations also include the requirements for a country or jurisdiction to be considered a preferential tax regime for Peruvian tax purposes. The Supreme Decree went into effect on January 1, 2019.

Tax havens or non-cooperative jurisdictions

The following countries or jurisdictions are included in Peru's black list: Andorra, Anguilla, Antigua and Barbuda, Aruba, Bahamas, Bahrain, Barbados, Belize, Bermuda, British Virgin Islands, Cayman Islands, Cook Islands, Curaçao, Cyprus, Dominica, Grenada, Gibraltar, Guam, Guernsey, Hong Kong, Isle of Man, Jersey, Labuan, Liberia, Liechtenstein, Maldives, Marshall Islands, Monaco, Montserrat, Nauru, Niue, Panama, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Samoa, Samoan Americans, Seychelles, Sint Maarten, Tonga, Trinidad and Tobago, Turks and Caicos Islands, Vanuatu and the Virgin Islands of the United States.

A country or jurisdiction may be included in the black list if one of the following requirements is met:

• There is no information exchange agreement or double tax treaty containing a clause for the exchange of information in force with Peru.
• There is no transparency at a legal, regulatory or administrative level.
• The corporate income tax (CIT) rate is zero or lower than 17.7% (60% of the current CIT rate in Peru, which is 29.5%).

A country or jurisdiction may be excluded from the list if one of the following requirements is met:

• The country is a member of the OECD.
• There is a double tax treaty in force with Peru that includes a clause for the exchange of information.
• The country effectively exchanges information with Peru without limitation based on domestic legislation or administrative practice.

Inclusions or exclusions apply as of January 1 of the year following the inclusion/exclusion.

Preferential tax regimes

A jurisdiction is a preferential tax regime if at least two of the following requirements are met:

• An information exchange agreement or double tax treaty containing a clause for the exchange of information is not in force with Peru.
• There is no transparency at a legal, regulatory or administrative level.
• The CIT rate is zero or lower than 17.7% (60% of the current CIT rate in Peru, which is 29.5%).
• Tax benefits are available for nonresidents, but not residents.
• The OECD considers the jurisdiction to be a harmful jurisdiction due to the lack of a requirement that there be a substantive local presence, real activities or economic substance.

Under the Supreme Decree, the transfer pricing rules apply to transactions entered with entities subject to preferential tax regimes. Previously, the transfer pricing rules only applied to transactions with related parties or residents of tax havens.

———————————————