Recently, the General Directorate of Internal Taxes (DGII) has issued the “Guidance for Facilitating the Recognition of Countries, States, or Territories with Preferential Tax Regimes and Tax Treatment”, applicable to the 2026 fiscal year.
In compliance with Article 62-A of the Tax Code, every September, the DGII publishes a list of countries, states, or territories classified as tax havens or low- or no-tax jurisdictions.
Some of the notable changes for 2026 are:
- New additions as low-tax territory: Bermuda, which in 2025 was on the zero-tax list, is now included as a low-tax territory.
- Removals from the list: Slovenia and the Union of the Comoros are no longer listed as low-tax territories.
- The following have been removed from the list of zero-tax jurisdictions: Norfolk Island, Saint Maarten, and Bermuda, which have been moved to the low-tax list.
References to the OECD and FATF reports have been updated to include the most recent results of Action 5 of the BEPS Plan, which identifies 332 regimes reviewed in early February 2025.
The position that neither the OECD nor the FATF publish exhaustive lists of tax havens is also maintained, but the focus on transparency, economic substance, and international cooperation is reinforced.
As in previous years, the Tax Guide notes that all entities that meet the following criteria are included in the lists of Zero or Low Taxation (as applicable), even if they are not expressly classified as such:
- Enjoy exemption from income tax or other similar taxes, or are subject to a tax calculated on income or net taxable income of less than 80% of the income tax that would be paid in El Salvador.
- Are covered by law or administrative provision in a preferential low or zero taxation regime, such as: holding companies, principal companies, auxiliary or mixed companies, service companies, finance or financial power branches, family asset management companies, Multinational Company Headquarters (SEM), international trusts, trusts, Limited Liability Companies (LLC), international leasing companies, Private Interest Foundations, International Business Corporations (IBC), and other similar entities.
It is essential to be aware of the lists of jurisdictions with preferential low or zero tax regimes, as conducting transactions with entities domiciled in these territories entails the obligation to apply transfer pricing rules, withholding income tax (25%), and the deductibility of losses, interest, commissions, and other financial payments.
For more information, please contact us at taxelsalvador@consortiumlegal.com.