1887

United Nations Handbook on Selected Issues in Administration of Double Tax Treaties for Developing Countries

image of United Nations Handbook on Selected Issues in Administration of Double Tax Treaties for Developing Countries

Double tax treaties play a key role in the context of international taxation, by reducing or eliminating double taxation over cross-border income, thus encouraging international investment and global economic growth, and by enhancing cooperation among tax administrations, especially in tackling international tax evasion and avoidance. This publication, which is designed especially for developing countries, aims at providing practical guidance to effectively implement double tax treaties and, in particular, those drawing upon the United Nations Model Double Taxation Convention between Developed and Developing Countries. Primary audiences are officials of national tax authorities and other tax professionals dealing with international taxation matters, the general public, media and universities.

English

.

Dispute resolution: The mutual agreement procedure

Article 25 of the United Nations Model Double Taxation Convention between Developed and Developing Countries1 (United Nations Model Convention) is a very important procedural provision for the application and implementation of the bilateral treaties based on the Model Convention. It provides for the establishment of a “mutual agreement procedure” (MAP) which enables the parties to the treaty to better carry out the substantive provisions contained therein, which allocate taxing rights. The MAP is administered by the “competent authorities”, who are generally named in Article 3 (e) of the treaties based on the United Nations Model Convention. It is very important to make clear the persons who will be designated as competent authorities. Typically, they come from the ministry or tax authority (that is to say, the responsible branch of the governments of the contracting States). They are the persons who are normally responsible for administering the treaty and the mutual agreement procedure in Article 25 sets forth the agreed rules and principles for ensuring that the functions of the treaty are properly adhered to. The role of the competent authorities in Article 25 is to “endeavour to resolve” by mutual agreement any difficulties or doubts arising as to the application of the treaty. It applies in connection with all articles of the convention.

English

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error