The Double Taxation Agreement signed by Japan and Uruguay recently entered into force, which seeks to eliminate double taxation in relation to income taxes, preventing tax evasion and avoidance.
The Interbank Deposit Certificate (IDC) signed generally follows the guidelines of the Model Agreement approved by the Organization for Economic Cooperation and Development (OECD).
Likewise, it is worth mentioning that as regards the relationship between the aforementioned nations, the IDC is in addition to the Agreement for the Liberalization, Promotion, and Protection of Investments signed by both countries in 2015.
However, regarding the entry into force, the Japanese ambassador in Uruguay, Tatsuhiro Shindo, highlighted in a press conference the importance of the agreement recently reached between both countries to eliminate double taxation in tax matters.
The diplomat emphasized the importance of the IDC “because it ensures all conditions for investment and trade between Uruguay and Japan” and expressed his hope that soon more Japanese companies will be able to be seen in Uruguayan territory and more Uruguayan companies in his country.
In the same line, the Uruguayan Foreign Ministry has highlighted the agreement in its social networks on July 23rd, as follows:
“This breakthrough is yet another milestone in the long history of friendship, shared values and ties between both countries, that in addition, we are also celebrating this year the centennial of diplomatic relations.”
In addition, the diplomat added that “Although we are celebrating 100 years of diplomatic relations between Japan and Uruguay, the friendly relations between both countries go back many years before when the first Japanese immigrants arrived and chose this land to raise their families”.
Finally, he said, “As part of the commemorative activities, we are planting sakura (cherry) trees throughout Uruguay as a symbol of friendship between the two nations. I hope that the Sakura flowers will illuminate the faces of all those who see them and that their petals will be the blessing of good omens for all”.
With this new IDC, it is expected that Japanese companies will invest more in Uruguay and vice versa.
Source: Swissinfo 30/07/21