January 30, 2019 Panama signed the Multilateral Competent Authority Agreement for Country-by-Country Reporting The MCAA CbCR will make it easier for Panama to obtain information on multinational entity groups from foreign tax authorities. On January 24, 2019, Panama's tax authorities signed the Multilateral Competent Authority Agreement for Country-by-Country Reporting (MCAA CbCR), which is a multilateral framework agreement that provides a standardized and efficient mechanism to facilitate the bilateral automatic exchange of country-by-country (CbC) reports. CbC reporting is one of the four minimum standards of the OECD/G20 Base Erosion and Profit Shifting Project. With the signature of the MCAA CbCR, Panama's tax authorities will be able to obtain from foreign tax authorities CbC reports containing information on the allocation of revenues and profits and other data of multinational entity (MNE) groups operating in Panama. Additionally, the MCAA CbCR requires Panama's tax authorities to provide CbC reports of the Panamanian headquartered groups to the tax authorities of all signatory jurisdictions in which the MNE group operates. The exchange of information will occur annually and automatically. To activate the bilateral exchange relationship under the MCAA CbCR, Panama will have to report to the Co-ordinating Body Secretariat: (1) a list of the jurisdictions with which Panama intends to exchange CbC Reports; or (2) a statement by which Panama will exchange CbC reports with all jurisdictions that list Panama as an exchange partner in their notifications. The next step for Panama is the development of the domestic legal framework for CbC reporting. A follow-up Tax Alert on the framework will be issued. ———————————————
| |||||||||||||||||
| |||||||||||||||||
