Today, Representatives Gerry Connolly (D-VA), Maria Elvira Salazar (R-FL), and Joaquin Castro (D-TX) introduced a resolution urging the U.S. Senate to ratify the U.S.-Chile Tax Treaty, a negotiated agreement between the Government of the United States of America and the Government of the Republic of Chile that would reduce double taxation and withholding rates on U.S. investments in Chile, consistent with the U.S. Model Tax Treaty. The treaty currently awaits consideration by the full Senate after the Senate Foreign Relations Committee overwhelmingly advanced consideration of the treaty on June 1, 2023 by a vote of 20-1.
In 2014, Chile passed new tax legislation that increased their corporate tax rate. Without a ratified bilateral tax treaty, American companies with operations in Chile will be subject to a tax rate of up to 44.45 percent beginning in 2027. By contrast, companies headquartered in countries with which Chile has bilateral tax treaties in place will continue to be subject to a 35 percent tax rate, leaving United States businesses at a significant competitive disadvantage.
“Chile is among our strongest democratic partners in the Western Hemisphere,” said Rep. Connolly. “As our two countries celebrate 200 years of close diplomatic relations, now is the time for the United States to follow through on our commitment to deepening our economic ties by ratifying the U.S.-Chile Tax Treaty. For far too long, the United States has overlooked the importance of strengthening our economic relationships with democratic partners in the Western Hemisphere. As China seeks to fill that void, the U.S.- Chile Tax Treaty is a positive step toward incentivizing U.S. investment in Chile and countering China’s malign economic activities. I’m proud to join Reps. Salazar and Castro in urging the Senate to provide its advice and consent to ratification of the treaty.”
“As the economic powerhouse of South America, Chile is well known for its strong defense of free markets and private property,” said Rep. Salazar, Chairwoman of the House Foreign Affairs Subcommittee on the Western Hemisphere. “The ratification of a new tax treaty will allow for U.S.-Chile business ties to continue flourishing and bring more prosperity to both Miami and Chile.”
“Ratification of the Chilean Tax Treaty is an important step to protect the jobs that U.S.-Chile trade and investment create in both countries,” said Rep. Castro, Ranking Member of the House Foreign Affairs Subcommittee on the Western Hemisphere. “The United States and Chile have a long record of cooperation on the important issues of our time — from clean energy to health care research. The Chilean Tax Treaty will support a stronger economic relationship between our nations and demonstrate America’s commitment to one of our most important partners in the Western Hemisphere.”
Full text of the resolution is available here.
Source link : https://connolly.house.gov/news/documentsingle.aspx?DocumentID=4771
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Publish date : 2023-06-09 03:00:00
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