The governments of the Philippines and Ireland recently held the first round of negotiations on a proposed bilateral agreement that aimed to avoid double taxation on individuals and companies in both countries.
Finance Undersecretary Antonette Tionko said the first round of talks held recently in Manila covered discussions on avoiding double taxation on income and capital gains as well as the prevention of tax evasion and avoidance.
“While there are other provisions that need to be considered by the Philippines like permanent establishment and entitlement to benefits, the provisions on persons covered, the taxes to be covered, provisions on residents and immovable property, and business profits, among others, have already been mutually agreed upon,” she said.
The Philippines currently has existing double taxation agreements with several countries, including the United States, Switzerland, the United Kingdom and Northern Ireland, United Arab Emirates, Thailand, Australia and Germany.
With a double taxation treaty in place, individuals that are residents of one country but receiving income in another contracting state or vice versa avoid being taxed twice for the same income, property or investment.
Such agreements also prevent tax evasion and encourage foreign trade and investments between countries. Tax relief to avoid double taxation may come in the form of exemptions or preferential tax rates.
The Philippine delegation to the talks held at the Ayuntamiento de Manila in Intramuros was led by Tionko, who headed the revenue operations group of the Department of Finance.
She said a draft of a double taxation agreement between the Philippines and Ireland was now being studied by both sides. —DAXIM L. LUCAS