THE PHILIPPINES and Cambodia have signed a double-taxation agreement (DTA), which the Department of Finance (DoF) expects to boost foreign investment and trade.
Finance Secretary Ralph G. Recto said in a statement: 鈥淭he signing of this DTA is a crucial step towards improving the integrity of our tax system.鈥
鈥淏y eliminating tax barriers and ensuring a fair and transparent framework, we are not only attracting greater foreign investment into the Philippines but also reinforcing our trade ties within the region,鈥 he added.
Mr. Recto and Cambodian Deputy Prime Minister and Minister of Foreign Affairs and International Cooperation Prak Sokhonn signed the DTA on Feb. 11.
It will take effect after ratification by the two countries鈥 respective legislative bodies.
The deal was reached after three rounds of negotiations, with the final round ending in Manila last year in April.
The DoF said the agreement will eliminate double taxation on income earned in the two countries, deter tax evasion, and enhance economic cooperation, aligning with commitments under the Association of Southeast Asian Nations Forum on Taxation.
The agreement is also expected to reduce fiscal barriers and stimulate bilateral trade and investment.
鈥淪pecifically, the agreement covers various aspects of taxation, including income from business profits, dividends, interests, royalties, capital gains, and other sources of revenue, ensuring a fair and efficient tax framework for businesses and individuals operating in both jurisdictions,鈥 it said.
It involves the exchange of tax information and dispute resolution mechanisms in line with the Base Erosion and Profit Shifting听 and tax transparency initiatives and standards, the DoF said. 鈥 Aubrey Rose A. Inosante
