Canada Announces Royal Assent To Tax Treaties

Mike Godfrey, Tax-News.com, Washington

22 December 2010

Jim Flaherty, Canadian Minister of Finance, has announced that Bill S-3, the legislation to implement tax treaties signed with Colombia, Greece and Turkey, has received Royal Assent. As such, Canada is now in a position to notify each of those countries of the completion of the procedures required to bring the relevant tax treaty into force in Canada.

The tax treaties with Colombia, Greece and Turkey will each enter into force after Canada and the other country notify each other of the completion of procedures for entry into force of the treaty.

“Giving effect to these treaties will provide a boost to bilateral trade and investment, and help us prevent international tax evasion,” explained Mr Flaherty.

The tax treaties covered by this legislation, like their predecessors, are patterned after the Organization for Economic Co-operation and Development (OECD) Model Tax Convention, which is accepted by most countries around the world. These treaties will remove tax barriers to trade and investment by eliminating double taxation and reducing excessive taxation due to high withholding taxes. As well, consistent with the policy announced in Budget 2007, these treaties include the OECD standard on exchange of tax information.

“These treaties will help create certainty and stability for investors and traders, and will enhance Canada’s economic relationship with these countries,” the Finance Minister said.

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