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Japan: Protocol to income tax treaty with United States, entry into force

Japan: Protocol to income tax treaty with United States

The instruments of ratification for the Protocol amending the income tax treaty between Japan and the United States have been exchanged between the two governments.


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The date of the Protocol’s entry into force is 30 August 2019.

  • Read text of the Protocol and related documents
  • Read today’s release from the U.S. Treasury Department reporting the entry into force of the Protocol to the Japan-United States income tax treaty

The Protocol amends the existing income tax treaty (2003) and provides for: 

  • Exemption from withholding taxes on interest (subject to certain exceptions)
  • Expansion of the scope of dividends eligible for exemption from withholding tax (allowing 50%-owned companies to qualify, and reducing the required holding period from 12 months to six (6) months)
  • Amendments to the capital gains article for consistency with the Foreign Investment in Real Property Tax Act (FIRPTA)
  • Mandatory binding arbitration of unresolved competent authority cases
  • Provisions to enable the competent authorities to assist each other in the collection of taxes
  • Broad exchange of information between the competent authorities for tax purposes

Read an August 2019 report prepared by the KPMG member firm in Japan

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