Manila: The Philippines and Hong Kong have embarked on the first round of negotiations to establish a Comprehensive Avoidance of Double Taxation Agreement (DTA). This endeavor is led by Bureau of Internal Revenue (BIR) Commissioner Romeo Lumagui Jr., who spearheads the Philippine Negotiating Panel, and his Hong Kong counterpart, Commissioner Benjamin Chan Sze-wai of the Inland Revenue Department.
According to Philippines News Agency, the discussions took place from May 21 to 23, 2025, at the Inland Revenue Centre in Kowloon. The primary focus of these negotiations is to strengthen international tax cooperation and promote economic partnerships. The meeting addressed key elements of the proposed treaty, which includes mechanisms to prevent double taxation, tax relief measures, and frameworks for mutual cooperation.
Commissioner Lumagui emphasized the importance of the DTA in fostering economic growth and providing clarity for businesses operating in both regions. He expressed the BIR's openness to international discussions that aim to enhance economic conditions for all parties involved. Lumagui also noted the need to address unresolved issues to ensure a balanced and equitable agreement, highlighting that further deliberation is necessary to reach a satisfactory outcome.
Both the Philippine and Hong Kong SAR negotiating panels have agreed to continue discussions in a second round of negotiations to finalize the agreement. This effort follows a similar agreement the Philippines signed earlier this year with Cambodia, designed to eliminate double taxation, prevent tax evasion, and enhance economic cooperation.
The DTA with Cambodia is expected to reduce fiscal barriers, stimulate bilateral trade and investment, and strengthen economic ties between the nations. It covers various aspects of taxation, including income from business profits, dividends, interests, royalties, capital gains, and other revenue sources, establishing a fair and efficient tax framework for businesses and individuals in both jurisdictions.
