Arab Saudi (Saudi Arabia)
AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDONESIA AND THE GOVERNMENT OF THE UNITED ARAB EMIRATES FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME The Government of the Republic of Indonesia and the Government of the United Arab Emirates, Intending to eliminate double taxation with respect to the taxes covered by this Agreement without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty shopping arrangements aimed at obtaining reliefs provided in this Agreement for the indirect benefit of residence of third jurisdictions), Have agreed as follows: Article 1 PERSONAL SCOPE 1. This Agreement shall apply to persons who are residents of one or both of the Contracting States. 2. This Agreement shall not affect the taxation by Indonesia of its residents, except with respect to the benefits granted under paragraph 3 of Article 7, paragraph 2 of Article 9, or Articles 17, 21, 23, 24, 25, or 27 of this Agreement. Article 2 TAXES COVERED 1. This Agreement shall apply to taxes on income imposed on behalf of a Contracting State, or its political subpisions or local authorities irrespective of the manner in which they are levied. 2. There shall be regarded as taxes on income all taxes imposed on total income, or on elements of income, including taxes on gains from alienation of movable or immovable property. 3. The existing taxes to which this Agreement shall apply are: (a) in the case of Indonesia: the income tax imposed under the Undang-undang Pajak Penghasilan 1984 (Law No. 7 of 1983 as amended) (income tax laws) (hereinafter referred to as Indonesian tax); (b) in the case of the United Arab Emirates: income tax, corporation tax (hereinafter referred to as United Arab Emirates tax). 4. This Agreement shall also apply 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 referred to in paragraph 2. The competent authorities of the Contracting States shall notify each other of any substantial changes which are made in their respective taxation laws within a reasonable period of time after such changes. Article 3 GENERAL DEFINITION 1. For the purpose of this Agreement, unless the context otherwise requires (i) the terms a “Contracting State” and “the other Contracting State” mean, as the context requires, the Republic of Indonesia or the United Arab Emirates; (ii) the term “Indonesia” comprises the territory of the Republic of Indonesia as defined in its laws and the adjacent areas over which the Republic of lndonesia has sovereignty, sovereign rights or jurisdiction in accordance with the provisions of the United Nations Convention on the Law of the Sea, 1982; (iii) the term “United Arab Emirates”, means the United Arab Emirates and, when used in the geographical sense, means its territory, including islands, territorial sea, and any other area in the sea or in the air within which the United Arab Emirates exercises under its law and in conformity with international law, sovereign rights or its jurisdiction; (iv) the term “tax” means Indonesian tax or United Arab Emirates tax as the context requires; (v) the term “person” includes an inpidual, a company, or any other body of persons; (vi) the term “company’ means any body corporate or any entity which is treated as a body corporate for tax purposes; (vii) the terms “enterprise of a Contractirig 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; (viii) the term “national” means all inpiduals possessing the nationality of a Contracting State and all legal persons, partnerships and associations deriving their status as such from the law in force in a Contracting State; 2. The term “international traffic” means any transport by ships 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. 3. The term “competent authority” means: (i) in the case of the Republic of Indonesia, the Minister of Finance or his authorised representative; and (ii) in the case of the United Arab Emirates, the Minister of Finance or his authorised representative. 4. In the application of this Agreement by either of the Contracting States, any term not defined therein shall – unless the context otherwise requires – have the meaning which it has under the laws of that State concerning the taxes to which the Agreement applies. Article 4 RESIDENT 1. For the purposes 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 incorporation, place of management or any other criterion of similar nature; b. In the case of the United Arab Emirates: 1) A United Arab Emirates national or an inpidual who is under the laws of the United Arab Emirates, is considered as a resident of the United Arab Emirates; and 2) Any person other than an inpidual that is incorporated under the laws of the United Arab Emirates or any political subpision, local government or local authority thereof. 2. Where by reason of the provisions of paragraph 1 an inpidual is deemed to be a resident of both Contracting States, then his status shall be defined as follows: (a) he shall be deemed to be a resident of the State in which he has a permanent home available to him. If he has a permanerit 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); (b) if the Contracting State in which he has his centre of vital interests cannot be