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2016 International Tax Forum

Explore the economic benefits and implications among developing economies from international tax agreements. Learn about the role of trade agreements in fostering growth and cooperation, with insights on tax treaties and their impact on investment. Discover reasons for negotiating agreements and their significance for developing countries. Dive into the Philippine Profile regarding Free Trade Agreements (FTAs) and Tax Treaties.

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2016 International Tax Forum

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  1. 2016 International Tax Forum “Fiscal Policy and Inclusive Growth” Assistant Commissioner Marissa O. Cabreros Bureau of Internal Revenue October 27 – 28, 2016

  2. Session 8: Tax Treaties and Trade Agreements: Economic benefits and implications among developing economies 2016 International Tax Forum “Fiscal Policy and Inclusive Growth” October 27 – 28, 2016

  3. Tax Treaties and Trade Agreements • Trade Agreementsare the product of negotiations between two or more sovereign nations that dictate the terms of the acceptable exchange of goods and services between the parties. • Tax Treaties promote trade and investment by allocating the taxing jurisdiction between the Contracting States so to eliminate or mitigate double taxation on income

  4. Tax Treaties and Trade Agreements • DTA or TIEA • OECD or UN • Global or Regional • FTA Pillars • Goods • Services • Investment

  5. Reasons for Trade Agreement • Trade facilitation • Liberalization • Mutual support for common issues • Freer trans-border flow of people • Capital formation

  6. Reasons for Trade Agreement • Cooperation in • Science and technology • Human resource development • Small and medium enterprises • Environment

  7. For developing countries • Global competitiveness • Sustainable growth • Efficiency in allocation of resources • Poverty alleviation

  8. Philippine Profile: Free Trade Agreement (FTAs)

  9. Reasons for entering into Tax Treaties* • To facilitate outbound investment by residents by: • Removing or reducing double taxation on investment in the other country; • Reducing excessive source country taxation; • In the case of low-tax countries, creating a competitive advantage for its residents by reducing or removing source taxation; *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  10. Reasons for entering into Tax Treaties* • To facilitate outbound investment by residents by: • Removing or reducing tax discrimination on investment in the other country; • Providing certainty and/or simplicity with respect to taxation on investment in the other country on out- bound investment by residents. *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  11. Reasons for entering into Tax Treaties* • To facilitate and encourage inbound investment and inbound transfers of skills and technology by residents of the other country by: • Removing or reducing double taxation on the inbound investment or transfers; • Reducing excessive source taxation; • Providing increased certainty and/or simplicity with respect to taxation of the inbound investment or transfers; *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  12. Reasons for entering into Tax Treaties* • To facilitate and encourage inbound investment and inbound transfers of skills and technology by residents of the other country by: • Developing a closer relationship between tax authorities and business; • Maintaining benefits of tax concessions and tax holidays provided with respect to inbound investment or transfers. *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  13. Reasons for entering into Tax Treaties* • To reduce cross-border tax avoidance and evasion through: • Exchange of tax information; • Mutual assistance in collection of taxes.   *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  14. Reasons for entering into Tax Treaties* • For political reasons, such as: • Sending a message of willingness to adopt international tax norms; • Fostering diplomatic or other relations with the other country; • Strengthening regional diplomatic, trade and economic ties; *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  15. Reasons for entering into Tax Treaties* • For political reasons, such as: • Complying with international obligations; • Responding to pressure from the other country. *UN Paper on Why we Negotiate? Written by Ms. Arianne Pickering

  16. For developing countries • To attract foreign direct investment • To attract inbound transfers of technology or skills • To respond to political or other pressure from other countries

  17. Philippine Profile: Tax Treaties

  18. Status of PH- ASEAN Treaty Network

  19. Tax Treaties and Trade Agreements….coupled with: • Workable investment protection mechanism, • Robust regulatory framework for trade and tax administration, • Competent mutual agreement procedure, • Efficient and effective capacity to collect and exchange information • Continuing and apt capacity and capability build-up both on the technical and negotiation skills

  20. End of Presentation Thank You!!!

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