{
  "title": "Guatemala: Technical Assistance Report-International Taxation Challenges and Options",
  "publication": "IMF Staff Country Reports, April 24, 2023",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2023/04/24/guatemala-technical-assistance-report-international-taxation-challenges-and-options-532733",
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  "summary": "This paper focuses on the technical assistance report on international taxation challenges and options in Guatemala. The topic of treaties has garnered special attention in Guatemala as of late, requiring a strategy to be devised.",
  "sections": [
    {
      "heading": "Executive summary and context",
      "content": "- Focus: technical assistance report on international taxation challenges and options in Guatemala.\n- Recent policy attention: treaties have garnered special attention in Guatemala and require a strategy to be devised.\n- Rationale for treaties:\n  - Foster a better business climate.\n  - Can encourage foreign direct index (FDI) in sectors other than those already benefiting from special regimes.\n  - Can promote expansion of certain businesses operating from Guatemala, especially export services, which can currently be subject to double taxation.\n- Current concern: Guatemala's FDI quota is low, even for the Central American region."
    },
    {
      "heading": "Empirical evidence and international experience",
      "content": "- Empirical studies do not offer conclusive results on the link between treaties and FDI.\n- The economic literature could not confirm a meaningful causal relationship between signed treaties and FDI, particularly for developing countries.\n- The same inconclusive finding applies to studies on Latin America."
    },
    {
      "heading": "Policy findings and options for Guatemala",
      "content": "- To enter into treaties, Guatemala requires the development of an own model that:\n  - Protects the right to tax income at source.\n  - Enables signing treaties with countries where a potential double-taxation problem might inhibit a likely flow of investment.\n- Consideration: the increase in special regimes in Guatemala might eventually risk running into an international trend (implied risk to treaty effectiveness or compatibility)."
    },
    {
      "heading": "Subject areas and keywords (as recorded)",
      "content": "- Subjects: Balance of payments, Double taxation, Foreign direct investment, Income, Income and capital gains taxes, International organization, Monetary policy, National accounts, Taxes, Transfer pricing\n- Keywords: base erosion and profit-shifting., Caribbean, Central America, Double taxation, double-taxation avoidance treaties, FDI data, foreign direct investment, Foreign direct investment, Foreign-direct investment, Global, Income, Income and capital gains taxes, maquila regime, PwC tax specialist, tax architecture, tax context, tax practice, tax purpose, tax strategy, taxation challenge, Transfer pricing, transfer-pricing\n\n---\n\n Content in this bundle\n\n- 1gtmea2023001\n  - 1gtmea2023001 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - 1gtmea2023001 (PDF){rel=\"external\" type=\"application/pdf\"}"
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    "Published: April 24, 2023",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9798400240638.002",
    "Focus: technical assistance report on international taxation challenges and options in Guatemala.",
    "Recent policy attention: treaties have garnered special attention in Guatemala and require a strategy to be devised.",
    "Rationale for treaties:",
    "Current concern: Guatemala's FDI quota is low, even for the Central American region.",
    "Empirical studies do not offer conclusive results on the link between treaties and FDI.",
    "The economic literature could not confirm a meaningful causal relationship between signed treaties and FDI, particularly for developing countries.",
    "The same inconclusive finding applies to studies on Latin America.",
    "To enter into treaties, Guatemala requires the development of an own model that:",
    "Consideration: the increase in special regimes in Guatemala might eventually risk running into an international trend (implied risk to treaty effectiveness or compatibility).",
    "Subjects: Balance of payments, Double taxation, Foreign direct investment, Income, Income and capital gains taxes, International organization, Monetary policy, National accounts, Taxes, Transfer pricing",
    "Keywords: base erosion and profit-shifting., Caribbean, Central America, Double taxation, double-taxation avoidance treaties, FDI data, foreign direct investment, Foreign direct investment, Foreign-direct investment, Global, Income, Income and capital gains taxes, maquila regime, PwC tax specialist, tax architecture, tax context, tax practice, tax purpose, tax strategy, taxation challenge, Transfer pricing, transfer-pricing",
    "**1gtmea2023001**"
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