I move:
That Dáil Éireann approves the following Order in draft:
Double Taxation Relief (Taxes on Income) (Kingdom of Belgium) Order, 1972
a copy of which Order in draft was laid on the table of Dáil Éireann on the 18th day of January, 1972.
Copies of the draft orders relating to double taxation relief conventions with Belgium, Italy, Luxembourg and Zambia were laid before Dáil Éireann on the dates mentioned in the motions which appear on the Order Paper.
The conventions have been signed on behalf of the respective Governments. Subsequent to the signing of the conventions, four White Papers containing the text of the relevant convention were laid before both Houses of the Oireachtas by the Minister for Foreign Affairs.
Before the conventions can enter into force, however, certain steps must first be taken under the laws of the countries concerned.
In this country the law provides that an arrangement entered into with a foreign Government to afford relief from double taxation in respect of income tax, sur-tax, corporation profits tax and any taxes of a similar character shall have the force of law here if the Irish Government makes an order accordingly. Prior to the making of such an order, however, a draft of the order must have been laid before Dáil Éireann and a resolution passed approving it.
Deputies will find the texts of the four conventions scheduled to the draft orders now before the House. For the convenience of Deputies, a separate memorandum has also been circulated with each draft order explaining briefly the effect of the articles in each convention.
The conventions with Belgium, Italy and Luxembourg will enter into force upon the exchange of instruments of ratification and the Zambian convention will enter into force once it has been given the force of law in both countries.
The convention with Belgium will have effect in Ireland, as respects income tax and sur-tax, for the year of assessment beginning on 6th April in the year in which the convention is ratified and, as respects corporation profits tax, for any accounting period beginning on or after 1st April of the year in which the convention is ratified. It will be effective in Belgium as respects all tax due at source on income normally credited or payable after 31st December of the year in which the instruments of ratification are exchanged. It will apply as respects all tax other than tax due at source on income of any accounting period. ending on or after 31st December of the same year.
I should add that a limited agreement between Ireland and Belgium was concluded on 4th December, 1967, for the avoidance of double taxation on income derived from the business of sea and air transport. This agreement will be suspended for the period for which the new convention is in force and relief from double taxation of the income covered by the agreement will be provided under the provisions of Article 8 of the new convention instead.
The convention with Italy will have effect in Ireland, as respects income tax and sur-tax, for 1967-68 and subsequent years of assessment and, as respects corporation profits tax, for any accounting period beginning on or after 1st April, 1967, and for the unexpired portion of any accounting period current at that date. It will be effective in Italy for taxable years beginning on or after 1st January, 1967.
The convention with Luxembourg will have effect in Ireland, as respects income tax and sur-tax, for 1968-69 and subsequent years of assessment and, as respects corporation profits tax, for any accounting period beginning on or after 1st April, 1968, and for the unexpired portion of any accounting period current at that date. It will be effective in Luxembourg for periods of assessment beginning on or after 1st January, 1968.
The convention with Zambia will have effect in Ireland, as respects income tax and sur-tax, for 1967-68 and subsequent years of assessment and, as respects corporation profits tax, for any accounting period beginning on or after 1st April, 1967, and for the unexpired portion of any accounting period current at that date. In Zambia, it will be effective for tax years beginning on or after 1st April, 1967.
Each of the conventions will remain in force indefinitely but may be terminated by either this country or the other partner country giving the appropriate notice of termination prescribed by the respective convention.
The provisions of the conventions with Belgium, Italy, Luxembourg and Zambia are broadly similar to those contained in the conventions which this country has concluded with other countries. In this respect I might mention that conventions are currently in force with Austria, Britain, Canada, Cyprus, Denmark, Finland, France, Federal Republic of Germany, Netherlands, Norway, Sweden, Switzerland and the United States of America. When the conventions that are now before the House come into force, we will then have double taxation relief arrangements with all the existing member States of the European Economic Community and the acceding countries. The main benefit which this country derives from the conclusion of such arrangements is the removal of a disincentive to the investment of foreign capital in Ireland.
I recommend that Dáil Éireann approve these draft orders.
