Avoidance of double taxation: foreign tax credit permits deduction of foreign tax against domestic tax subject to a limitation.

Where a resident derives income taxable in the other Contracting State, the resident's State must allow as a deduction an amount equal to the income tax paid in the other State, whether paid directly or by deduction, but not exceeding the part of the domestic tax attributable to that income (computed before the deduction). For this purpose, tax paid in the other State is deemed to include tax that would have been payable but for tax incentives designed to promote economic development.

---

---

---