CONVENTION BETWEEN
THE GOVERNMENT OF THE REPUBLIC OF INDONESIA
AND
THE GOVERNMENT OF THE FRENCH REPUBLIC
FOR
THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME
AND CAPITAL
Article 1
PERSONAL SCOPE
This Convention shall apply to persons who are residents of one or both of the Contracting States.
Article 2
TAXES COVERED
1. |
This Convention shall apply to taxes on income and on capital imposed on behalf of each |
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2. |
There shall be regarded as taxes on income and on capital all taxes imposed on total income, on |
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3. |
The existing taxes to which the Convention shall apply are: |
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(a) |
in the case of Indonesia : |
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(1) |
the income tax; |
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(2) |
the corporation tax; |
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(3) |
the net wealth tax; including any withholding tax, prepayment or advance payment with respect to |
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(4) |
the tax on dividends, interest and royalties, |
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(b) |
in the case of France : |
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(1) |
the income tax; |
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(2) |
the corporation tax; |
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4. |
The Convention shall apply also to any identical or substantially similar taxes which are imposed |
Article 3
GENERAL DEFINITIONS
1. |
In this Convention, unless the context otherwise requires : |
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(a) |
the terms “one of the Contracting States” and “the other Contracting State” mean France or |
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(b) |
the term “Indonesia” comprises the territory of the Republic of Indonesia as defined in its laws |
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(c) |
the term “France” means the European and overseas departments of the French Republic, including |
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(d) |
the term “person” comprises an individual, a company and any other body of persons; |
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(e) |
the term “company” means any body corporate or any entity which is treated as a body corporate for |
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(f) |
the terms “enterprise of a Contracting State” and “enterprise of the other Contracting State” mean |
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(g) |
the term “nationals” means: |
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(1) |
all individuals possessing the nationality of a Contracting State; |
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(2) |
all legal persons, partnerships and associations deriving their status as such from the law in |
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(h) |
the term “competent authority” means: |
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(1) |
in the case of Indonesia, the Minister of Finance or his authorised representative; |
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(2) |
in the case of France, the Minister of the Budget or his authorised representative. |
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2. |
As regards the application of the Convention by a Contracting State any term not otherwise defined |
Article 4
FISCAL DOMICILE
1. |
For the purposes of this Convention, the term “resident of a Contracting State” means any person |
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2. |
Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting |
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(a) |
he shall be deemed to be a resident of the Contracting State in which he has a permanent home |
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(b) |
if the Contracting State in which he has his centre of vital interests cannot be determined, or if |
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(c) |
if he has an habitual abode in both Contracting States or in neither of them, the competent |
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3. |
Where by reason of the provisions of paragraph 1 a person other than an individual is a resident |
Article 5
PERMANENT ESTABLISHMENT
1. |
For the purposes of this Convention, the term “permanent establishment” means a fixed place of |
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2. |
The term “permanent establishment” shall include especially: |
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(a) |
a place of management; |
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(b) |
a branch; |
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(c) |
an office; |
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(d) |
a factory; |
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(e) |
a workshop; |
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(f) |
a farm or plantation; |
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(g) |
a mine, an oil well, quarry or other place of extraction of natural resources; |
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(h) |
a building site or construction or assembly project which exists for more than six months. |
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3. |
The term “permanent establishment” shall not be deemed to include: |
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(a) |
the use of facilities solely for the purpose of storage or display of goods or merchandise |
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(b) |
the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the |
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(c) |
the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the |
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(d) |
the maintenance of a fixed place of business solely for the purpose of purchasing goods or |
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(e) |
the maintenance of a fixed place of business solely for the purpose of advertising, for the supply |
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4. |
A person acting in a Contracting State on behalf of an enterprise of the other Contracting State |
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(a) |
if he has, and habitually exercises in that State, an authority to conclude contracts in the name |
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(b) |
if he habitually maintains in that State a stock of goods or merchandise belonging to the |
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5. |
An enterprise of a Contracting State shall be deemed to have a permanent establishment in the |
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6. |
An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the |
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7. |
An insurance enterprise of a Contracting State shall be deemed to have a permanent establishment |
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8. |
The fact that a company which is a resident of a Contracting State controls or is controlled by a |
Article 6
INCOME FROM IMMOVABLE PROPERTY
1. |
Income from immovable property including income from agriculture or forestry may be taxed in the |
2. |
The term “immovable property” shall be defined in accordance with the taxation laws of the |
3. |
The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use |
4. |
The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of an |
Article 7
BUSINESS PROFITS
1. |
The profits of an enterprise of a Contracting State shall be taxable only in that State unless the |
2. |
Subject to the provisions of paragraph 3, where an enterprise of a Contracting State carries on |
3. |
In the determination of the profits of a permanent establishment, there shall be allowed as |
4. |
Insofar as it has been customary in a Contracting State to determine the profits to be attributed |
5. |
No profits shall be attributed to a permanent establishment by reason of the mere purchase by that |
6. |
For the purposes of the preceding paragraphs, the profits to be attributed to the permanent |
7. |
Where profits include items of income which are dealt with separately in other Articles of this |
Article 8
SHIPPING AND AIR TRANSPORT
1. |
Profits derived by an enterprise from the operation of ships or aircraft in international traffic |
2. |
The provisions of paragraph 1 shall also apply to profits derived by an enterprise from the |
Article 9
ASSOCIATED ENTERPRISES
Where:
(a) |
an enterprise of a Contracting State participates directly or indirectly in the management, |
(b) |
the same persons participate directly or indirectly in the management, control or capital of an |
and in either case conditions are made or imposed between the two enterprises in their commercial or
financial relations which differ from those which would be made between independent enterprises, then any
profits which would, but for those conditions, have accrued to one of the enterprises but, by reason of
those conditions, have not so accrued, may be included in the profits of that enterprise and taxed
accordingly.
Article 10
DIVIDENDS
1. |
Dividends paid by a company which is a resident of a Contracting State to a resident of the other |
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2. |
However, such dividends may be taxed in the Contracting State of which the company paying the |
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(a) |
10% of the gross amount of the dividends if the recipient is a company which owns directly at |
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(b) |
in all other cases, 15% of the gross amount of the dividends. |
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3. |
The term “dividends” as used in this Article means income from shares, “jouissance” shares or |
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4. |
The provisions of paragraphs 1 and 2 shall not apply if the recipient of the dividends, being a |
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5. |
A resident of Indonesia who receives dividends paid by a company which is a resident of France may |
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6. |
Where a company resident of a Contracting State has in the other Contracting State a permanent |
Article 11
INTEREST
1. |
Interest arising in a Contracting State and paid to a resident of the other Contracting State may |
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2. |
However, such interest may be taxed in the Contracting State in which it arises, and according to |
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3. |
Notwithstanding the provisions of paragraph 2 of this Article, the tax charged by the Contracting |
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(a) |
the interest is paid by a bank, a financial institution or by an enterprise the activities of |
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(b) |
the interest is paid to a bank or to another enterprise. |
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4. |
Notwithstanding the provisions of paragraph 2 of this Article, interest arising in a Contracting |
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(a) |
to that other Contracting State or to a statutory body thereof, or |
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(b) |
to an enterprise of that other Contracting State on loans or credits granted with the participation of a financing public institution of that other State and with the consent of the Minister in charge of financial or economic affairs or of planning of the first-mentioned Contracting State, in connection with the sale of any industrial or scientific equipment or with the survey, the installation or the supply of industrial or scientific premises or of public works. |
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5. |
The term “interest” as used in this Article means income from debt-claims of every kind, whether |
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6. |
The provisions of paragraphs 1, 2, 3 and 4 shall not apply if the recipient of the interest, being |
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7. |
Interest shall be deemed to arise in a Contracting State when the payer is that State itself, a |
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8. |
Where, owing to a special relationship between the payer and the recipient or between both of them |
Article 12
ROYALTIES
1. |
Royalties arising in a Contracting State and paid to a resident of the other Contracting State may |
2. |
However, such royalties may be taxed in the Contracting State in which they arise, and according |
3. |
The term “royalties” as used in this Article means payments of any kind received as a |
4. |
The provisions of paragraphs 1 and 2 shall not apply if the recipient of the royalties, being a |
5. |
Royalties shall be deemed to arise in a Contracting State when the payer is that State itself, a |
6. |
Where, owing to a special relationship between the payer and the recipient or between both of them |
Article 13
CAPITAL GAINS
1. |
Gains from the alienation of immovable property, as defined in paragraph 2 of Article 6, or from |
2. |
Gains from the alienation of movable property forming part of the business property of a permanent |
3. |
Gains from the alienation of any property other than those mentioned in paragraphs 1 and 2, shall |
Article 14
INDEPENDENT PERSONAL SERVICES
1. |
Income derived by a resident of a Contracting State in respect of professional services or other |
2. |
The term “professional services” includes especially independent scientific, literary, artistic, |
Article 15
DEPENDENT PERSONAL SERVICES
1. |
Subject to the provisions of Articles 16, 18 and 19, salaries, wages and other similar |
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2. |
Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting |
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(a) |
the recipient is present in the other State for a period or periods not exceeding in the aggregate |
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(b) |
the remuneration is paid by, or on behalf of, an employer who is not a resident of the other |
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(c) |
the remuneration is not borne by a permanent establishment or a fixed base which the employer has |
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3. |
Notwithstanding the preceding provisions of this Article, remuneration in respect of an employment |
Article 16
DIRECTORS’ FEES
member of the board of directors or a similar organ of a company which is a resident of the other
Contracting State may be taxed in that other State.
Article 17
ARTISTES AND ATHLETES
1. |
Notwithstanding the provisions of Articles 14 and 15, income derived by entertainers, such as |
2. |
Where income in respect of personal activities as such of an entertainer or athlete accrues not to |
3. |
Notwithstanding the provisions of paragraph 1, remunerations or profits, and wages, salaries and |
4. |
Notwithstanding the provisions of paragraph 2, where income in respect of personal activities as |
Article 18
PENSIONS
1. |
Subject to the provisions of paragraph 2 of Article 19, pensions and other similar remuneration |
2. |
Notwithstanding the provisions of paragraph 1, social security pensions paid by a social security |
Article 19
GOVERNMENT SERVICE
1. | (a) |
Remuneration, other than a pension, paid by a Contracting State or one of its political |
(b) |
However, such remuneration shall be taxable only in the other Contracting State if the services |
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2. |
Any pensions paid by, or out of funds created by, a Contracting State or one of its political |
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3. |
The provisions of Articles 15 and 16 shall apply to remuneration in respect of services rendered |
Article 20
STUDENTS
1. |
Payments which a student or business apprentice who is or was formerly a resident of a Contracting |
2. |
Notwithstanding the provisions of paragraph 1, remuneration which a student or business apprentice |
Article 21
TEACHERS AND RESEARCHERS
1. |
A teacher or a researcher who, resident of a Contracting State, visits the other Contracting State |
2. |
This Article shall not apply to income from research if such research is undertaken not in the |
Article 22
OTHER INCOME
1. |
Items of income of a resident of a Contracting State, wherever arising, not dealt with in the |
2. |
The provisions of paragraph 1 shall not apply if the recipient of the income, being a resident of |
Article 23
CAPITAL
1. |
Capital represented by immovable property, as defined in paragraph 2 of Article 6, may be taxed in |
2. |
Capital represented by movable property forming part of the business property of a permanent |
3. |
Ships and aircraft operated in international traffic by an enterprise and movable property |
4. |
All other elements of capital of a resident of a Contracting State shall be taxable only in that |
Article 24
METHOD FOR ELIMINATION OF DOUBLE TAXATION
Double taxation shall be avoided in the following manner :
1. |
In the case of Indonesia: |
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(a) |
Indonesia may include in the basis upon which taxes referred to in Article 2 paragraph 3(b) are |
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(b) |
Subject to the provisions of sub-paragraph (c) below, Indonesia shall allow a reduction from the |
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(c) |
Where a resident of Indonesia derives income which, in accordance with the provisions of Article |
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(d) |
Where a resident of Indonesia derives gains which may be taxed in France in accordance with the |
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2. |
In the case of France: |
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(a) |
Income other than that referred to in sub-paragraph (b) below shall be exempt from the French |
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(b) |
Income referred to in Articles 10, 11, 12, 14, 16 and 17, received from Indonesia, may be taxed in |
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(c) |
Notwithstanding the provisions of sub-paragraphs (a) and (b) above, French tax is computed on |
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(d) |
In the cases where Indonesian tax levied on dividends, interest or royalties is wholly relieved or |
Article 25
NON-DISCRIMINATION
1. |
The nationals of a Contracting State, who are residents of one of the Contracting States, shall |
2. |
The taxation on a permanent establishment which an enterprise of a Contracting State has in the |
3. |
Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled, |
4. |
In this Article, the term “taxation” means taxes which are the subject of this Convention. |
Article 26
MUTUAL AGREEMENT PROCEDURE
1. |
Where a resident of a Contracting State considers that the actions of one or both of the |
2. |
The competent authority shall endeavour, if the objection appears to it to be justified and if it |
3. |
The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement |
4. |
The competent authorities of the Contracting States may communicate with each other directly for |
5. |
The competent authorities of the Contracting States shall by mutual agreement settle the mode of |
Article 27
EXCHANGE OF INFORMATION
1. |
The competent authorities of the Contracting States shall exchange such information as is |
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2. |
In no case shall the provisions of paragraph 1 be construed so as to impose on one of the |
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(a) |
to carry out administrative measures at variance with the laws or the administrative practice of |
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(b) |
to supply particulars which are not obtainable under the laws or in the normal course of the |
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(c) |
to supply information which would disclose any trade, business, industrial, commercial or |
Article 28
DIPLOMATIC AND CONSULAR OFFICIALS
1. |
Nothing in this Convention shall affect the fiscal privileges of members of diplomatic missions |
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2. |
Notwithstanding the provisions of Article 4, an individual who is a member of a diplomatic or |
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(a) |
in accordance with international law, he is not taxable in the receiving State on income from |
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(b) |
he is liable in the sending State to the same obligations in relation to tax on his total world |
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3. |
This Convention shall not apply to international organisations, to organs and officials thereof |
Article 29
TERRITORIAL SCOPE
1. |
This Convention may be extended, either in its entirety or with any necessary modifications, to |
2. |
Unless otherwise agreed by both Contracting States, the denunciation of the Convention by one of |
Article 30
ENTRY INTO FORCE
1. |
Each Contracting State shall notify to the other the completion of the procedure required by its |
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2. |
Its provisions shall apply for the first time: |
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(a) |
as regards taxes withheld at source on dividends, interest and royalties, to amounts payable on or |
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(b) |
as regards other taxes on income, to income derived during the calendar year in which the |
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(c) |
as regards taxes on capital, to capital for the calendar year in which the Convention entered into |
Article 31
TERMINATION
1. |
This Convention shall remain in force indefinitely. However, after 1981, each Contracting State |
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2. |
In such an event, its provisions shall apply for the last time : |
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(a) |
as regards taxes withheld at source, to sums payable before or on 31 December of the calendar year |
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(b) |
as regards other taxes on income, to income derived during the calendar year for the end of which |
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(c) |
as regards taxes on capital, to capital taxable for the calendar year for the end of which the |
this Convention.
Done in duplicate at Jakarta, this fourteenth day of September 1979, in the French and Indonesian
languages, both texts being equally authoritative.
For the Government of |
For the Government of the French Republic |
PROTOCOL
Government of the Republic of Indonesia for the avoidance of double taxation and the prevention of fiscal
evasion with respect to taxes on income and on capital, the undersigned have agreed upon the following
provision which is an integral part of this Convention.
“It is understood that profits from the operation of ships in the meaning of Article 8 can only be derived
by an enterprise which carries out shipping business on its own account and responsibility.”
validity as if it were inserted word by word in the Convention.
Done at Jakarta, this fourteenth day of September 1979, in duplicate, in the French and Indonesian
languages, both texts being equally authoritative.
For the Government of |
For the Government of the French Republic |