Brunei Darussalam
AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDONESIA AND THE GOVERNMENT OF THE REPUBLIC OF BRUNEI DARUSSALAM FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME Article 1 PERSONAL SCOPE This Agreement shall apply to persons who are residents and Government of one or both of the Contracting States. Article 2 TAXES COVERED This Agreement shall apply to taxes on income and capital gains imposed on behalf of each Contracting State, irrespective of the manner in which they are levied. There shall be regarded as taxes on income and capital gains all taxes imposed on total income and total capital gains, or on elements of income and capital gains, including taxes on gains from the alienation of movable or immovable property. The existing taxes to which the Agreement shall apply are: (a) in the case of Brunei Darussalam; (i) income tax imposed under Income Tax Act (Cap. 35); (ii) petroleum profits tax imposed under Income Tax (Petroleum) Act, (Cap. 119); (hereinafter collectively referred to as “Brunei tax”); (b) in the case of Indonesia; the income tax imposed under the Undang-Undang Pajak Penghasilan 1984 (Law no. 7 of 1983 as amended) (hereinafter referred to as “Indonesian tax”). This Agreement shall apply also to any identical or substantially similar taxes which are subsequently imposed in addition to, or in place of, the existing taxes referred to in paragraph 3 above. The competent authorities of the Contracting States shall notify each other of any significant changes which have been made in their respective taxation laws within a reasonable period of time after such changes and furnish copies of relevant enactments and regulations. If by reason of changes made in the taxation law of either Contracting State, it appears desirable to amend any Article of this Agreement without affecting the general principles thereof, the necessary amendments may be made by mutual consent by means of an exchange of diplomatic notes or in any other manner in accordance with their constitutional procedures. Article 3 GENERAL DEFINITIONS In this Agreement, unless the context otherwise requires: (a) the term “Brunei” means: the territory of Brunei Darussalam as defined in its laws and the adjacent areas over which Brunei Darussalam has sovereignty, sovereign rights or jurisdiction in accordance with the provisions of the United Nations Convention on the Law of the Sea, 1932; (b) the term “Indonesia” means : the territory of the Republic of Indonesia as defined in its laws and the adjacent areas over which the Republic of Indonesia has sovereignty, sovereign rights or jurisdiction in accordance with the provisions of the United Nations Convention on the Law of the Sea, 1982; (c) the term “Government” means: (i) in the case of Brunei Darussalam; (1) The Brunei Currency Board, (2) The Brunei Investment Agency, (3) Any local or statutory authority or body exempt from tax in Brunei Darussalam, (4) Any body corporate controlled or wholly owned by the Government of Brunei Darussalam, (5) Such institutions as may be agreed from time to time between the two Contracting States; (ii) in the case of Indonesia; (1) Local authorities. (2) A political subpision. (3) The Central Bank or any financial institution controlled by the Government the capital of which is wholly owned by the Government; (d) the terms “a Contracting State” and “the other Contracting State” mean Brunei or Indonesia as the context requires; (e) the term “tax” means Brunei tax or Indonesian tax as the context requires; (f) the term “person” includes an inpidual, a company, a body of persons and any other entity which is treated as a taxable entity under the tax laws of the respective Contracting States; (g) the term “company” means any body corporate or any other entity which is treated as a company under the tax laws of the respective Contracting States; (h) the terms “enterprise of a Contracting State” and “enterprise of the other Contracting State” mean respectively an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State; (i) the term “national” means: (i) (a) in the case of Brunei Darussalam: any natural person who is afforded the status of a national under the applicable laws in Brunei and may also include any person in possession of a national passport issued by the competent authorities; (b) in the case of Indonesia: any natural person who is afforded the status of a national under the applicable laws in Indonesia; (ii) any legal person, partnership and association deriving its status as such from the laws in force in a Contracting State; (j) the term “international traffic” means carriage of passengers, mail, livestock or goods by a ship or aircraft which is operated by an enterprise of one of the Contracting States, except when the ship or aircraft is operated solely between places in the other Contracting State or solely between such places and one or more structures used for the exploration or exploitation of natural resources situated in waters adjacent to the territorial waters of that other Contracting State; (k) the term “competent authority” means: (i) in Brunei: the Minister of Finance or his authorised representative; (ii) in Indonesia: the Minister of Finance or his authorised representative. As regards the application of this Agreement by a Contracting State, any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws of that Contracting State relating to the taxes which are the subject of this Agreement. Article 4 RESIDENT For the purpose of this Agreement, the term “resident of a Contracting State” means any person who, under the laws of that Contracting State, is liable to tax therein by reason of his domicile, residence, place of management or any other criterion of a similar nature. Where by reason of the provisions of paragraph 1 an inpidual is a resident of both Contracting States, then his status shall be determined in accordance