Kuwait (Kuwait)
AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDONESIA AND THE GOVERNMENT OF THE STATE OF KUWAIT FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND ON CAPITAL Article 1 PERSONAL SCOPE This Agreement shall apply to persons who are residents of one or both of the Contracting States. Article 2 TAXES COVERED This Agreement shall apply to taxes on income and on capital imposed on behalf of a Contracting State, or of its political subpisions or local authorities thereof, irrespective of the manner in which they are levied. There shall be regarded as taxes on income and on capital all taxes imposed on total income, on total capital, or on elements of income or of capital, including taxes on gains from the alienation of movable or immovable property, as well as taxes on capital appreciation. The existing taxes to which this Agreement shall apply are in particular: (a) 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”); (b) in the case of Kuwait: (1) the corporate income tax; (2) the 5% of the net profits of shareholding companies payable to the Kuwait Foundation for Advancement of Science (KFAS); and (3) the Zakat (hereinafter referred to as “Kuwait tax”). This Agreement shall apply also to any identical or substantially similar taxes which are imposed after the date of signature of this Agreement in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify each other of any substantial changes which have been made in their respective taxation laws. Article 3 GENERAL DEFINITIONS For the purposes of this Agreement, unless the context otherwise requires : (a) the term “Indonesia” comprises the territory of the Republic of Indonesia as defined in its laws and the adjacent areas over which Indonesia has sovereign rights or jurisdiction in accordance with the provisions of the United Nations Convention on the Law of the Sea, 1982; (b) the term “Kuwait” means the State of Kuwait and includes any area beyond the territorial sea which in accordance with international law has been or may be designated under the laws of Kuwait as an area in which Kuwait may exercise sovereign rights or jurisdiction; (c) the terms “a Contracting State” and “the other Contracting State” mean Indonesia or Kuwait as the context requires; (d) the term “person” includes an inpidual, a company and any other body of persons; (e) the term “national” means any inpidual possessing the nationality of a Contracting State as well as any legal person, partnership and association deriving its status as such from the laws in force in a Contracting State; (f) the term “company” means any body corporate or any entity which is treated as a body corporate for tax purposes; (g) the term “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; (h) the term “international traffic” means any transport by a ship or aircraft operated by an enterprise of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State; (i) the term “tax” means Indonesian tax or Kuwaiti tax, as the context requires; (j) the term competent authority means: (1) in Indonesia: the Minister of Finance or his authorized representative; (2) in Kuwait: the Minister of Finance or his authorized representative; As regards the application of this Agreement by a Contracting State any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the law of that Contracting State concerning the taxes to which this Agreement applies. Article 4 RESIDENT For purpose of this Agreement, the term resident of a Contracting State means: (a) in the case of Indonesia, any person who, under the tax laws of Indonesia is liable to tax therein by reason of his domicile, residence, place of management or any other criterion of similar nature; (b) in the case of Kuwait, an inpidual who has his domicile in Kuwait and is a Kuwaiti national, and a company which is incorporated in the State of Kuwait. For the purposes of paragraph 1, a resident of a Contracting State shall include: (a) the Government of that Contracting State or any political subpision or local authority thereof; and (b) any government institution created in that Contracting State under public law such as a corporation, Central Bank, fund, authority, foundation, agency or other similar entity; and a (c) in the case of Kuwait, any inter-government entity established in Kuwait in whose capital Kuwait subscribes together with other States. Where by reason of the provisions of paragraph 1 an inpidual is a resident, of both Contracting States, then his status shall be determined as follows: (a) he shall be deemed to be a resident of the State in which he has a permanent home available to him; (b) if he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer (centre of vital interests); (c) if the Contracting State in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; (d) if he has an habitual abode in both Contracting States or in neither of them, he shall be deemed to be a resident of the Contracting State of which he is a national; (e) if his status cannot be determined under the provisions of subparagraphs (a) to (d), the competent authorities of the