Portugal removes Hong Kong, Liechtenstein, and Uruguay from its tax blacklist

As of 1 January 2026, Portugal will remove Hong Kong, Liechtenstein, and Uruguay from its national register of jurisdictions deemed to have more favourable tax regimes (the 'tax blacklist').

For nearly 20 years, Portugal has maintained an almost unchanged national blacklist of jurisdictions. This list is broader and separate from the European Union (EU)'s list of non-cooperative jurisdictions for tax purposes. 

Contrary to the reasoning behind the EU list, there is no automatic de-listing rule, that automatically excludes jurisdictions from the Portuguese blacklist upon the entry into force of a double tax treaty. This may seem unusual, but it is the reality as Portugal continues to maintain tax treaties with multiple jurisdictions still on its blacklist. The same lack of automatic removal applies to jurisdictions with a Tax Information Exchange Agreement (TIEA) in force with Portugal.

Being included on the Portuguese blacklist has significant tax implications under domestic law, including: 

• Trailing tax on Portuguese national individuals: Individuals transferring their tax residence to a blacklisted jurisdiction are subject to extended Portuguese tax liability for four years after departure. 
• Controlled Foreign Company (CFC) rules: Exposure to CFC rules may lead to profits of a listed entity being directly taxed in the hands of Portuguese tax resident individuals or corporations holding, directly or indirectly, at least 25% of blacklisted CFC entities.
• Real estate investments: Non-resident investors from blacklisted jurisdictions who hold real estate investments in Portugal may face punitive property taxation. 
• Cross-border payments: Payments by Portuguese companies to blacklisted jurisdictions may not be deductible for tax purposes and/or could attract a 35% autonomous tax rate.
• Withholding taxes:  Portuguese withholding taxes on certain investment income are increased from 28% (for individuals), 25% (for companies) to 35% without entitlement to reduced treaty rates unless an applicable double tax treaty exists.

• Participation exemption and inbound dividends/capital gains regimes do not apply when income is sourced from blacklisted jurisdictions.
  Income generated in blacklisted jurisdictions faces additional restrictions under the application of the NHR 2.0. scheme (IFICI).

The removal of Hong Kong, Liechtenstein, and Uruguay suggests an increasing alignment with EU policy as none of these jurisdictions appear on the EU’s list. It will have notably positive practical consequences for cross-border business involving Asia and Brazil (with Uruguay often being used by Brazilian investors).

This article was contributed to by João Magalhães Ramalho, Partner and co-head of the Tax Law practice area with Joana Cunha d'Almeida at our strategically partnered law firm, ECIJA