Macau (MNA) – The Macau SAR Government has proposed the abolishment of a current offshore law in order to comply with Organisation for Economic Co-operation and Development (OECD) standards regarding the treatment of offshore firms under Macau SAR law.
A proposal regarding the abolishment of Decree-Law 58/99/M has been submitted to the Legislative Assembly (AL).
As a step to tackle cross-border tax evasion, this abolishment would mean that current enterprises operating under the law detailed above will be only allowed to run offshore institutions with a special tax-free status, as well as exemption of stamp duty, until June 2021.
The exemption means that affected companies will not be able to enjoy tax concessions on supplementary taxes, even in the event that offshore institutions change their registered business names and purpose of business registered within 90 days of the expiry of their offshore business permit.
This abolishment will affect approximately 360 companies with a total staff of 1,700, which according to government spokesperson Leong Vai Tac are unlikely to be [overly] affected due to the transition period given.
Macau has joined the Base Erosion and Profit Shifting (BEPS) OECD framework on November 2016.
In addition, Macau has been de-listed from a list of tax havens by the European Union (EU) in January 2018 and has announced that it would automatically share tax information with the EU from September 1.