Sooner State News

WASHINGTON, DC – Senator James Lankford (R-OK) provided his advice and consent for the Chilean Tax Treaty, a treaty that has been pending for more than a decade that would open up more US business opportunities with fewer double-taxation fears, including and especially mining business opportunities for critical minerals. The treaty was ratified by Chile in 2015. Lankford joined Senator Marco Rubio (R-FL) and their colleagues in a letter in December 2021 asking for the treaty to be prioritized in the Senate Foreign Relations Committee, and the resolution of ratification for the treaty finally passed in a vote of 95 to 2.

“One of the Senate’s most important duties is to advise and provide consent on international treaties, and this tax treaty with Chile has been a decade in the making,” said Lankford. “I have supported this treaty for years, which has collected dust in the Senate while nations like China have already moved forward. Chile has an open economy, well-developed government and financial institutions, and a strong rule of law. In addition to numerous business opportunities with less worry about double taxation, US investors will have stronger access to Chile’s deposits of critical minerals like lithium and copper to help reduce our dependence on China and other hostile nations. I’m glad to finally get this done for American business investment.”

The US has income tax treaties with 68 countries, covering the majority of foreign trade and investment for the US. The primary function of these treaties is to provide protection for US taxpayers from double taxation, restricting the signatory nations from imposing income tax on US citizens and allowing deductions for companies in the foreign country. They also reciprocally reduce US withholding of taxes, which encourages foreign companies to invest in the US. This treaty represents the first bilateral income tax treaty between the US and Chile, and our third with a Latin American country. It would also build on the success of our free trade agreement with Chile, which took effect in 2004. Additionally, the treaty ensures policies in the 2017 Tax Cuts and Jobs Act are respected.  

Original source can be found here.