Business profits taxation: only profits attributable to a permanent establishment may be taxed in the other state.

Profits of an enterprise are taxable only in its resident State unless it carries on business in the other State through a permanent establishment, in which case only profits attributable to that permanent establishment may be taxed there. Attribution is determined as if the permanent establishment were a separate and independent enterprise under similar conditions; reasonable estimation is permitted where precise determination is impracticable. Deductions for expenses incurred for the permanent establishment's business are allowed, purchases of goods alone do not create attributable profits, and the attribution method should be applied consistently year to year.

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