Negotiations between Hungary and Andorra on a bilateral tax treaty have concluded, the treaty can be signed at the earliest in 2021 and could come into force in 2022, the Finance Ministry said on Wednesday, according to a report by state news wire MTI.
The proposed treaty covers taxes on income and excludes double taxation of individuals or enterprises by determining the extent to which the parties have the right to tax each type of income.
Another main purpose of the treaty is to prevent tax evasion or avoidance, including schemes that could provide tax exemptions or reduced taxation to residents in third countries. The agreement also provides a framework for co-operation between the tax authorities of the parties and allows for a full exchange of information and provides a framework for the settlement of tax disputes.
Andorra is one of the last European states with which Hungary is signing a tax treaty, raising the number of tax treaties Hungary has signed to 84.