Taxation of international shipping and air transport income confined to the enterprise's residence state, with limited source-state tax. Profits from operation of ships or aircraft in international traffic by an enterprise of a Contracting State are taxable only in that State. This includes ticket sales on behalf of others, activities directly connected with transportation, rental incidental to transportation, and use or rental of containers and related equipment. Participation in pools, joint businesses, code sharing or international operating agencies is covered. Interest connected with operation is treated as such profits and Article 11 does not apply. Gains on alienation of ships, aircraft or containers used in these operations are taxable only in the enterprise's State. Income from operation between the other Contracting State's ports and third-country ports may be taxed by that other State but with a tax reduction equal to 50% of the tax imposed.
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.
Taxation of international shipping and air transport income confined to the enterprise's residence state, with limited source-state tax.
Profits from operation of ships or aircraft in international traffic by an enterprise of a Contracting State are taxable only in that State. This includes ticket sales on behalf of others, activities directly connected with transportation, rental incidental to transportation, and use or rental of containers and related equipment. Participation in pools, joint businesses, code sharing or international operating agencies is covered. Interest connected with operation is treated as such profits and Article 11 does not apply. Gains on alienation of ships, aircraft or containers used in these operations are taxable only in the enterprise's State. Income from operation between the other Contracting State's ports and third-country ports may be taxed by that other State but with a tax reduction equal to 50% of the tax imposed.
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