RSS   Newsletter   Contact   Advertise with us

Panama, Colombia to resolve tax-haven spat

Staff writer ▼ | October 21, 2014
Panama and Colombia said they will talk uninterruptedly to resolve a dispute that erupted after Bogota included the Central American nation on its list of tax havens.
Panama, Colombia
Uninterrupted talks   A joint press conference:
Panama’s vice president and foreign minister, Isabel De Saint Malo de Alvarado, and Colombia’s foreign minister, Maria Angela Holguin, delivered the news during a joint press conference they gave Friday after a meeting in this capital.

“We’re convinced that through dialogue and diplomatic channels... we’ll reach a solution to the multiple issues on the table,” De Saint Malo said.

She added, however, that Panama will include Colombia on its own list of countries that discriminate against it and take unspecified retaliatory measures early next week if its neighbor does not reverse its decision.

On Tuesday, Panama said it was giving Colombia seven days to remove it from its tax-haven list and threatened tit-for-tat action if that deadline is not met.

The top diplomats also confirmed that Panamanian Trade Minister Meliton Arrocha and Colombian counterpart Cecilia Alvarez Correa met Friday in Bogota to resolve a bilateral trade dispute.

Panama has filed a complaint against Colombia with the World Trade Organization over alleged discriminatory tariffs imposed on textiles, apparel and footwear.

Bogota formally designated Panama as a tax haven on Oct. 8, three days after that country failed to meet a deadline for signing a fiscal information-sharing agreement.

The Panamanian Foreign Ministry said Colombia had been told that the proposed information-sharing agreement would be detrimental to the Central American country’s position as an international financial center.

The inclusion of Panama means a tax on money transfers to the Central American nation will be raised from 10 percent to 33 percent and that Colombians will no longer be able to deduct purchases made there on their income-tax returns.

Bogota is seeking greater clarity about the amount of assets that its citizens are holding abroad so that information can be included in a tax-overhaul bill currently before Congress, the head of Colombia’s DIAN revenue agency said.

The bill aims to raise more revenue to fund post-conflict development projects envisioned in draft agreements reached in peace talks between the government in Bogota and the Revolutionary Armed Forces of Colombia, or FARC, guerrilla group.