Elimination of double taxation through a tax credit limited to the resident State tax attributable to foreign-taxed income or capital.

Article 25 mandates that the resident State relieve double taxation by granting a credit for income tax or capital tax paid in the other State, limited to the portion of resident State tax attributable to the income or capital taxed abroad. Exempted income or capital may be included in computing tax on remaining taxable items. Taxes reduced or waived under the other State's incentive provisions are deemed "tax paid" for credit purposes, while amounts payable for defaults or omissions are excluded from the term.

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