Shipping profits taxable at place of effective management; other state may tax certain port-to-third-country voyages with reduced tax. Profits from the operation of ships in international traffic are taxable only in the Contracting State where the enterprise's place of effective management is situated; if that place is aboard a ship it is treated as located in the State of the home harbour or, lacking a home harbour, the State of the operator's residence. This rule also covers participation in pools, joint businesses and international operating agencies. Income from voyages between a Contracting State's ports and third-country ports may be taxed by the other Contracting State, but the tax so imposed is subject to a reduction equal to half of that tax.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Shipping profits taxable at place of effective management; other state may tax certain port-to-third-country voyages with reduced tax.
Profits from the operation of ships in international traffic are taxable only in the Contracting State where the enterprise's place of effective management is situated; if that place is aboard a ship it is treated as located in the State of the home harbour or, lacking a home harbour, the State of the operator's residence. This rule also covers participation in pools, joint businesses and international operating agencies. Income from voyages between a Contracting State's ports and third-country ports may be taxed by the other Contracting State, but the tax so imposed is subject to a reduction equal to half of that tax.
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