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#31746 - 11 Jan 06 12:09 JP/RI, Malaysia flesh out treaty on double taxation
biznews Moderator Offline
Pujangga Besar

Registered: 24 Apr 08
Posts: 7508
Loc: Jakarta
From The Jakarta Post
RI, Malaysia flesh out treaty on double taxation

Rendi A. Witular, The Jakarta Post, Jakarta

President Susilo Bambang Yudhoyono is slated to sign a memorandum of understanding (MOU) with visiting Malaysian Prime Minister Abdullah Ahmad Badawi this week to expand the current agreement on the avoidance of double taxation.

Minister of Foreign Affairs Hassan Wirayuda said on Monday the measure was needed because the current agreement was no longer sufficient to accommodate the interests of the business community in the two countries.

"The revision is to boost business activities between the two countries, and to accommodate our new tax laws," he said, adding the MOU would be signed during Badawi's informal visit to Bukittinggi, West Sumatra, from Jan. 12 to Jan. 13.

Minister of Finance Sri Mulyani Indrawati said the deal would cover double taxation for proceeds derived from dividends, royalties and transfer of funds.

However, it would not cover transactions conducted in the offshore financial center island of Labuan, she added.

The island tax haven is a federal territory of Malaysia, which is strategically located close to Brunei Darussalam in the South China Sea.

Both ministers declined to provide further details.

In the original treaty signed in 1991, interest, dividends and royalties are subject to a reduced rate of withholding tax.

At present, the Indonesian government has signed a tax treaty with 54 countries, including Luxembourg, Tunisia, Algiers, the Ukraine, Slovakia, the Seychelles, Sudan, Syria, Uzbekistan and Mongolia.

A tax treaty with a foreign country is normally designed to avoid double taxation of that country's residents or companies operating in Indonesia, or Indonesian citizens or companies in the foreign country.

The treaty is also aimed at attracting foreign investors to participate in the country's financial sector, such as banking and the capital market.
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#31747 - 11 Jan 06 13:13 Re: JP/RI, Malaysia flesh out treaty on double taxation
Polar Bear Offline
Pujangga Besar

Registered: 23 Nov 05
Posts: 6177
I HATE taxation. Why does a government think it knows better than me how to spend my money.

In the West the idiot economists use taxation to control inflation. The government likes the idea because it gives them a lot more money - which they thow away. EXAMPLE - Australia is about to give 100 Million to China to compbat glabal warming. China is the fastest growing economy in the world. We shoulsd slap trade tarrifs on Chinese goods BECAUSE of Glabal warming - not give them my money.

#31748 - 12 Jan 06 09:00 Re: JP/RI, Malaysia flesh out treaty on double taxation
dee Offline

Registered: 10 Nov 05
Posts: 59
Loc: Jakarta
I think the tax treaty is good and mutual for both countries.. it is aimed to avoid double taxation.. However for some people tax could be pain in da ass shocked cause sometimes it doesn't bring any goods and benefits for those people who already pay tax.. The outcomes just doesn't the way we want it..

#31749 - 12 Jan 06 13:41 Re: JP/RI, Malaysia flesh out treaty on double taxation
cherry Offline

Registered: 08 Nov 05
Posts: 1055
Loc: Indonesia
almost everyone didn't want to pay the tax and hate very much tax.
as long as I know, many businessmens in Indonesia didn't want to pay tax, by means of avoided made NPWP (tax number).
vote me!


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