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A comprehensive bilateral tax treaty between the United States and Chile enters into force today. The Chile tax treaty is the first new comprehensive bilateral tax treaty signed by the United States to enter into force in more than ten years. The U.S. Senate provided advice and consent to ratification of the treaty on June 22, 2023, and President Biden signed the instrument of ratification in December. The treaty entered into force today when the United States notified Chile that it had completed the required procedures for bringing the treaty into force.
The Chile tax treaty will reduce tax-related barriers to cross-border investment between the United States and Chile, facilitating stronger bilateral business ties. Lower tax rates will allow entities doing business in both countries to save money. U.S. and Chilean companies and industry associations have long championed the passage of this tax treaty, which will make Chilean companies more competitive in the United States, and U.S. companies more competitive in Chile. The United States remains the number one market for Chilean women-led and small and medium-size businesses. This treaty will reduce the cost of business for them, as well.
The United States has 57 comprehensive tax treaties, covering more than 60 nations around the world. The U.S.-Chile bilateral tax treaty is only the second comprehensive income tax treaty in force with a South American country.
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