Philippines, Germany Update Tax Treaty
Germany and Philippines have completed the necessary domestic ratification procedures to bring their new double tax agreement into force.
The two nations exchanged instruments of ratification on December 20 to replace their existing treaty, which was concluded in 1983.
Negotiations on the upgraded treaty were concluded on July 20, 2012, following three rounds of negotiations. Both sides agreed on the adoption of new standards in the tax treaty, designed to provide further protection against the risk of double taxation, where the same income would be taxable in the Philippines and Germany.
The new provisions are also aimed at preventing tax evasion and fostering cooperation between two countries in the enforcement of tax law.
Germany is the Philippines’ top trading partner in Europe and its ninth-largest trading partner in the world, with bilateral trade worth USD5.35bn in 2014.
