New double taxation agreement signed between Iceland and Brazil to enhance trade

A new double taxation agreement between Iceland and Brazil aims to level the playing field for local workers and businesses, reduce tax evasion, and promote mutual trade. The agreement, which covers income tax, was signed on Monday.

According to the Icelandic government, the primary goal of the agreement is to prevent double taxation on business operations, investments, salaries, and income between the two countries. It is designed to enhance the competitiveness of Icelandic enterprises and labor, facilitate operations between the nations, increase predictability in trade, and encourage reciprocal investment.

Trade with Brazil is considered significant for Iceland, and the agreement has been in preparation for a lengthy period. It aligns with the policies of the United Nations and reflects comparable principles set out by the Organisation for Economic Co-operation and Development (OECD) regarding double taxation.

Icelandic authorities plan to increase the number of double taxation agreements to ensure companies have access to foreign labor and to allow employees to work abroad without facing double taxation.

Bergdís Ellertsdóttir, Iceland’s Ambassador and Deputy Director of the Ministry for Foreign Affairs, signed the agreement on behalf of Iceland, while Ambassador Rodrigo de Azeredo Santos did so on behalf of Brazil. The implementation of the double taxation agreement will be pursued in the coming months.