The Agreement in principle on a new Convention replacing the current Convention between Japan and the Kingdom of the Netherlands for the Avoidance of Double Taxation with respect to Taxes on Income
December 18, 2009
- The Government of Japan and the Government of the Kingdom of the Netherlands have agreed in principle on a new Convention replacing the current Convention between Japan and the Kingdom of the Netherlands for the Avoidance of Double Taxation with respect to Taxes on Income, which was concluded in 1970 and partly amended in 1992.
- This new Convention, which is the result of the overall revision of the current Convention, reduces or exempts tax at source on the incomes from investments (Dividends, Interest and Royalties), includes provisions aimed at preventing tax evasion, and thereby contributes to further expanding investments and economic exchanges between Japan and the Kingdom of the Netherlands.
- The main points of this new Convention, which were agreed upon in principle, are as follows:
(1) Tax at source on the income from investments (dividends, interest and royalties) will be reduced or exempted (see attachment);
(2) Income derived in respect of a sleeping partnership (Tokumei Kumiai) contract may be taxed at source in Japan; and
(3) The new Convention will include the provisions to prevent the abuse of the Convention. - After the respective Governments have completed their domestic procedures, the text of the new Convention will be authenticated by signature. This new Convention will enter into force, after the completion of the domestic procedures necessary for the conclusion of the Agreement (in the case of Japan, approval by the Diet will be required).
(END)
Attachment: Tax at source on the income from investments[PDF]
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