International Tax Policy and Legislation
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International Tax Policy and Legislation. Institutional support and legislation for bilateral trade in the area of taxation. Arno Oudijn. May. Content. DTC’s Role and purpose of DTC’s Objectives of Netherlands and Colombian Governments Prospects Customs Agreement.

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International Tax Policy and Legislation

Institutional support and legislation for bilateral trade in the area of taxation

Arno Oudijn

May


Content
Content

  • DTC’s

  • Role and purpose of DTC’s

  • Objectives of Netherlands and Colombian Governments

  • Prospects

  • Customs Agreement


Role and purpose of dtc s
Role and purpose of DTC’s

Elimination of double taxation

Attribution of taxation rights

Mitigation of taxation at source

Obligation to eliminate double taxation

Prevention of fiscal evasion

Exchange of information

Specific rules to counter abuse

Legal certainty

Encouraging cross-border trade and investment


Typical issues in dtc s related to cross border trade and investment
Typical issues in DTC’s related to cross border trade and investment

Tresholds for taxation on activities in the host State (P.E.’s, services and wages) =>reduction of administrative burden

Mitigation of taxation at source on investment income and capital gains

Dividends

Interest

Royalty’s

Capital Gains

Taxation of wages

Non-discrimination

Mutual Agreement Procedures


Objectives of the netherlands and colombian governments
Objectives of the Netherlands and Colombian Governments investment

Netherlands

Small domestic market =>international orientation

Creating level playing field abroad

Encouraging investment in the Netherlands

Legal certainty for investors

Colombia

Solid growth

Economy in transition

Encouraging investments in Colombia

Transition to regional hub


Examples
Examples investment

Company A is interested in a bid on a short term dredging contract in Colombia. If conditions are met, no obligation to pay income tax in Colombia;

Company B establishes subsidiary C in Colombia for agricultural production. C pays royalty’s to Company B. COL withholding tax is 33%. NL Corporate Income tax is 25%. Patent Box may be applicable.

Company D has a branch in COL. It seeks certainty that the profits attributed to the branch in COL are calculated according to international standards.

Company E is interested in establishing a subsidiary in the Netherlands. Under a DTC it can repatriate it’s profits at a reduced rate of dividend withholding tax.


Work in progress
Work in progress investment

Ongoing negotiations

Results expected in 2012

Ratification process in both countries

Positive effect on cross border trade and investment to be expected.


Customs agreement
Customs Agreement investment

Mutual political interest recently reconfirmed

Negotiations planned 2012

Scope of the Agreement exceeds Free Trade agreement EU-COL

Enhanced facilitation of growing trade flows

Enhanced co-operation in enforcement in respect of IPR & drugs offences

Agreement to also cover Caribbean parts of the Kingdom



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