Elimination of double taxation uses exemption and limited tax credit methods to prevent dual taxation on resident income. Elimination of double taxation is achieved by: (a) the exemption method, where the State of residence exempts income taxed in the other State but may apply domestic tax rates as if such income were included; and (b) the credit method, where the State of residence may include foreign-taxed income in its tax base but must allow a deduction for tax paid in the other State, limited to the domestic tax attributable to that income. 'Tax paid in the other Contracting State' includes amounts foregone due to deductions, exemptions, reductions or similar reliefs under that State's law.