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Japan Signs DTA With Kuwait

Friday, February 19, 2010

The Japanese Ministry of Finance has announced the signing of a double taxation agreement (DTA) with Kuwait Japan's first such agreement with a Middle Eastern state.

The agreement was signed by Masatoshi Muto, the Japanese Ambassador to Kuwait, and Khalifa Hamada, Undersecretary for the Ministry of Finance in Kuwait, on February 17.

In a similar manner to the DTAs already concluded between Japan and other countries, this DTA adjusts the taxation rights between Japan and Kuwait to avoid international double taxation arising from economic and human exchanges. Reflecting the strengthened economic relations between Japan and the State of Kuwait, the DTA clarifies the limit of withholding tax rates imposed on dividends, interest and royalties (copyrights, patents and others), to promote mutual investments.

The DTA will remove barriers to trade and investment, facilitating greater economic relations. According to the Japanese Ministry of Finance, exports to Japan from Kuwait currently amount to around USD15.2bn annually, comprising mainly crude oil and petroleum products, and Kuwait imports motor vehicles, machinery and electrical equipment worth around USD2.1bn annually.

The DTA will be approved in accordance with the legal procedures of each of the countries, and shall enter into force on the thirtieth day after the date of exchange of diplomatic notes indicating such approval.