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In September 2025, Portugal officially removed Hong Kong from its tax blacklist, a change that takes full effect on January 1, 2026.
This decision is the final step in Hong Kong’s transition away from its former reputation as a tax haven, confirming that it is no longer blacklisted by any country worldwide.
The move also aligns Portugal’s policy with the European Union, which had already removed Hong Kong from its “grey list” of non-cooperative jurisdictions for tax purposes, last year.
Together, these developments mark a turning point, solidifying Hong Kong’s status as a transparent, compliant, and competitive global business hub.
The Portuguese government’s decision was driven by Hong Kong’s adherence to international transparency standards and the strength of the Double Tax Treaty (DTA) between the two jurisdictions.
As a result, Portuguese companies or individuals investing in or through Hong Kong will no longer face punitive tax measures – such as higher transfer rates or special withholding taxes – and will instead benefit from standard tax treatment.
This shift not only simplifies cross-border transactions but also reflects a broader trend: Hong Kong’s successful alignment with global tax regulations (1) reinforcing its status as a highly beneficial tax hub on the world stage (2).
- Hong Kong: a clean tax reputation worldwide
With its removal from Portugal’s blacklist, Hong Kong now enjoys a clean tax reputation globally. It is not blacklisted by the EU, OECD, or G20, and its compliance with international standards has been widely recognized.
This is a critical advantage in today’s regulatory environment, where tax transparency and compliance are paramount. Businesses operating in Hong Kong can now do so with confidence, knowing their jurisdiction is both competitive and fully compliant with global norms.
- Hong Kong remains a top destination for business taxation
Hong Kong’s appeal extends far beyond its improved tax reputation. Its territorial tax system – where only locally sourced income is taxed – remains a cornerstone of its attractiveness.
Foreign-sourced dividends, interest, and royalties are tax-exempt, making it an ideal location for international trading, investment holding, and regional headquarters. The city’s maximum corporate tax rate of 16.5% is highly competitive, and for qualifying offshore income, the effective tax rate can be as low as 0%.
Beyond taxation, Hong Kong offers a robust financial infrastructure and seamless access to Mainland China and broader Asian markets. There is no capital gains tax, no VAT, and no withholding tax on dividends or interest, further enhancing its appeal for businesses seeking efficiency and profitability.
Whether you are looking to establish a regional headquarters, optimize your tax strategy, or tap into the dynamic economies of Asia, Hong Kong offers the transparency, stability, and efficiency your business needs to thrive.
Ready to explore the possibilities? Contact us today (contact@orbis-alliance.com) to discuss how we can support your business setup, tax planning, and growth in Hong Kong.