Portuguese fiscal changes have tremendous positive effects in Madeira, hence recovering Madeira’s previous competitiveness.

Dividend, royalties, and interest payments to shareholders located in countries that have signed a DTA with Portugal, enjoy a 0% withholding.

Furthermore, the application of the “particpation-exemption” principle makes that any Madeira company, commercial or otherwise, can serve as a holding without taxing dividends and capital gains from its subsidiaries.

Finally, the 36% increase of the turnover ranges that enjoy a reduced taxation of 5%.

The incorporation of Madeira companies that can benefit from the above mentioned advantages has been extended until June 2014.

Although there are rumors from sources close to the SDM (Sociedad para el Desarrollo de Madeira) that the negotiations for extending current tax exemptions beyond 2020 are well under way.