São Paulo – Saudi Arabia and Hungary signed this Monday (24) a deal to avoid double taxation of income tax on profits obtained in reciprocal investments. The treaty was signed during the Arab-Hungarian Economic Forum, in Riyadh, according to information from the CEO of the Arab Brazilian Chamber of Commerce, Michel Alaby, who is in the Saudi capital to attend the event.
The document was signed in the presence of the Hungarian Prime-minister, Viktor Orban, and the second deputy prime minister, Muqrin Bin Abdulaziz Al Saud. According to information provided by the Saudi Press Agency (SPA), the deal defines the tax regime given to a resident of one of the party states when they exert any activities in the other party state, and ensures there will not be double taxation over gains from this activity.
The Saudi Finance minister, Ibrahim Bin Abdulaziz Al Assaf, said, according to SPA, that the deal will reduce the tax loads on investors from one country who have business in the other one. This kind of agreement is seen as a way to boost foreign investments, as the investor knows he will only have to pay income tax in one of the countries and not in both. Several Arab governments have already manifested interest in signing treaties of this kind with Brazil.
* Translated by Rodrigo Mendonça
