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Entry into force of comprehensive taxation agreements between Australia and China and Australia and Fiji



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fPRESSl) TREASURER NO. l (RELEASE vNO EMBARGO STATEMENT BY THE ACTING TREASURER. THE HON. J. S. DAWKINS. M.P.

ENTRY INTO FORCE OF COMPREHENSIVE TAXATION AGREEMENTS

Comprehensive taxation agreements between Australia and China and Australia and Fiji entered into force on 28 December 1990 following exchanges of notes with the respective countries through the diplomatic channel indicating that the necessary procedures to give the agreements the force of law had been completed in each country.

Signature of the respective agreements took place in Canberra on 17 November 1988 (Chinese agreement) and 15 October 1990 (Fijian agreement). Details of each agreement were made public on the respective signature dates and legislation providing for the agreements to be given the force of law in Australia - the Taxation Laws Amendment (International Agreements) Act 1990 -

received the Royal Assent on 28 December 1990.

Each agreement is a comprehensive one for the avoidance of double taxation in relation to all income flowing between Australia and the other country. The allocation of taxing rights between the countries under each agreement generally

accords with that provided for in Australia's other modern comprehensive taxation agreements.

The agreement with China will have effect in Australia for withholding tax purposes in respect of income derived on or after 1 July 1991. It will first have effect for other Australian taxes in relation to income or gains of the year of

income beginning on 1 July 1991. The agreement will have effect in China for withholding tax purposes in relation to income derived on or after 1 January 1991 and for other taxes in relation to income or gains of its year of income beginning on

that date.

BETWEEN AUSTRALIA AND CHINA

AND AUSTRALIA AND FIJI

COMMONWEALTH PARLIAMENTARY LIBRARY MICAH

The agreement with Fiji will have effect in Australia for withholding tax purposes in respect of income derived on or after 1 January 1991, and for other income tax purposes in relation to income or gains of any year of income beginning on

or after 1 July 1991. It will first have effect in Fiji for Fijian taxes covered by the agreement in respect of income or gains derived during Fiji's income tax year beginning on 1 January 1991.

Each agreement limits the withholding tax or other tax that the source country may apply on certain dividends, interest or royalties payable to residents of the other country. The relevant tax rate limits provided by the agreement with China are 15 per cent of the gross amount for dividends and 10 per cent for interest and royalties. The Fiji agreement tax rate

limit for dividends is 20 per cent of the gross payment, 10 per cent for interest and 15 per cent for royalties. Details of the practical application of those tax rate limits in relation to Australian withholding tax or income tax imposed on an

assessment basis are available from Taxation Offices.

Formal notifications of the entry into force of the respective agreements will be published in the Gazette as soon as practicable.

CANBERRA 8 January 1991

CONTACT OFFICER TELEPHONE : Ken

i (06) (06)

Allen 275 1155 292 1821 (Work)

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