Minutes of The Negotiations

Between

The Government of The Republic of Indonesia

And

The Government of The Hashemite Kingdom of Jordan

 

For the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income .

            The Government of The Republic of Indonesia and The Government of The Hashemite Kingdom of Jordan.

            DESIRING to conclude an Agreement For the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.

             Have agreed as follows :

Article 1

PERSONAL  SCOPE

              This Agreement shall apply to persons who are residents of one or both of the Contracting States .

Article 2

TAXES COVERED

1.       This Agreement shall apply to taxes on income imposed on behalf of  each  Contracting State or of its political subdivisions or local authorities , irrespective of the manner in which they are levied  .

2.         There shall be regarded  as taxes on income all taxes imposed on total income, or on elements of income, including taxes on gains from the alienation of movable or immovable property .

3.         The existing taxes to which the Agreement shall apply are  :

                        a.         in Indonesia  :

                                    the income tax imposed under the Undang-undang Pajak  Penghasilan 1984 ( Law No. 7 of 1983 as amended)

                                    ( hereinafter referred  to as " Indonesian tax " );

            b.         in  Jordan   :

                                                -           the income tax ;

                                                -           the distribution tax;

                                                -           the social service tax;

                                    ( hereinafter referred  to as " Jordanian tax " ) .

 4.         The Agreement shall apply also to any identical or substantially similar taxes which are imposed after the date of signature of the Agreement in addition to, or in place of  the existing taxes . The competent authorities of the Contracting States shall notify each other of any substantial changes which have been made  in their respective taxation laws .

Article  3

GENERAL  DEFINITIONS

 1.       For the purposes of this Agreement, unless the context otherwise requires :

            a.                       i.    the term " Indonesia " comprises the territory of the Republic of Indonesia as defined in its laws ;

                                      ii. the term "  Jordan " means the territories of the Hashemite Kingdom of Jordan, the territorial waters of Jordan, and the seabed and subsoil of the territorial waters, and includes any area extending beyond the limits of the territorial waters of Jordan, and the seabed and subsoil of any such area, which has been or may hereafter be designated, under the laws of Jordan, and in accordance with international law as an area over which Jordan has sovereign  rights for the purposes of exploring and exploiting the natural resources, whether living or non-living ;

 

            b.   the term " person " includes an individual, a company and any other body of persons ;

             c.    the term " company " means any body corporate or any entity    which is treated as a body corporate for the tax purposes ;

             d.    the terms " enterprise of a Contracting State " and " enterprise of         the other Contracting State " mean respectively an enterprise carried on by a resident of Contracting State and an enterprise carried on by a resident of the other Contracting State ;

            e. the term " international traffic " means any transport by a ship or aircraft operated by an enterprise of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State ;           

             f.    the term " competent authority " means :

                                      i. in Indonesia

the Minister of Finance or his authorised   representative ;

            ii. in Jordan,

the Minister of Finance or his authorised representative ;

             g.                       the term " national " means :

                                      i. any individual possessing the nationality of a Contracting State;

                                      ii. any legal person, partnership and association deriving its status as such from the laws in force in a Contracting State ;

                        h.                       the term " fixed base " means a permanent place in which professional activities are exercised;

 

2.         As regards the application of the Agreement by a  Contracting State any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the law of that State concerning the taxes to which the  Agreement applies .

 

Article  4

RESIDENT

 

1.       For the purposes of this Agreement, the term " resident of a Contracting State " means any person who, under the laws of that State , is liable to tax therein by reason of his domicile, residence, place of management or any other criterion of a similar nature . But this term does not include any person who is liable to tax in that State in respect only of income from sources in that State .

 

 2.        Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows :

            a.         he shall be deemed to be a resident of the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident             of the State with which his personal and economic relations are closer (centre of vital interests ) ;

            b.         if  the State in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either State, he shall be deemed to be a resident of the State in which he has an habitual abode ;

            c.         if he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident of the State of which he is a          national;

            d.         if the status of resident cannot be determined according to sub-paragraphs a - c , the  competent authorities of the Contracting States    shall settle the question by mutual agreement .

 

3.         Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Contracting States, the  competent authorities of the States shall settle the question by mutual agreement .

 

Article  5

PERMANENT ESTABLISHMENT

 

1.       For the purposes of this Agreement, the term " permanent establishment " means a fixed place of business through which the business of an enterprise is wholly or partly carried on .

2.         the term " permanent establishment " includes especially :

            a.         a place of management ;

            b.         a branch ;

            c.         an office ;

            d.         a factory ;

            e.         a workshop ;

            f           a warehouse or premises used as sales outlet;

            g.         a farm or plantation ;

            h.         a mine, an oil or gas well, a quarry or any other place of extraction or exploration of natural resources, drilling rig or working ship used for exploration or exploitation of natural resources . 

3.         The term " permanent establishment " likewise encompasses :

            a.         a building site, a construction, assembly or installation project or          supervisory activities in connection therewith, but only where such site, project or activities continue for a period of more than six       months;

            b.         the furnishing of services, including consultancy services, by an   enterprise through employees or other personnel engaged by the       enterprise for such purpose, but only where activities of that nature continue ( for the same or a connected project ) within the country       for a period or periods aggregating more than one month within any twelve month period .

4.         Notwithstanding the preceding provisions of  this Article, the  term  “permanent establishment” " shall be deemed not to include :

            a.         the use of the facilities solely for the purpose of storage or display of goods or merchandise belonging to the enterprise ;

            b.         the maintenance of a stock of goods or merchandise belonging to the   enterprise solely for the purpose of storage or display ;

 

            c.         the maintenance of a stock of goods or merchandise belonging to the   enterprise solely for the purpose of processing by another enterprise;

            d.         the maintenance of a fixed place of business  solely for the purpose      of purchasing goods or merchandise, or of collecting information for the enterprise ;

            e.         the maintenance of a fixed place of business  solely for the purpose      of advertising, or for the supply of information ;

            f.          the maintenance of a fixed place of business  solely for the purpose      of carrying on, for the enterprise, any other activity of a preparatory        or auxiliary character ;

            g.         the maintenance of a fixed place of business  solely for any combination of activities mentioned in sub-paragraphs a. to f. ,          provided that the overall activity of the fixed place of business          resulting from this combination is of a preparatory or auxiliary character .

5.         Notwithstanding the provisions of paragraphs 1 and 2, where a person - other than an agent of an independent status to whom paragraph 7 applies - is acting in a Contracting State on behalf of an enterprise of the other Contracting State, that enterprise shall be deemed to have a permanent establishment in the first-mentioned State in respect of any activities which that person undertakes for the enterprise, if such a person :

            a.         has and habitually exercises in that State an authority to conclude contracts in the name of the enterprise, unless the activities of such      person are limited to those mentioned in paragraph 4 which, if exercised through a fixed place of business, would not make this fixed place of business a permanent establishment under the provisions of that paragraph; or

            b.         has no such authority, but habitually maintains in the first mentioned State a stock of goods or merchandise from which he regularly delivers goods or merchandise on behalf of the enterprise ; or

            c.         manufactures or processes in that State for the enterprise goods or merchandise belonging to the enterprise .

 

6.         An insurance enterprise of a  Contracting State shall, except with regard to reinsurance, be deemed to have a permanent establishment in the other Contracting State if it collects premiums in that other State or insures risks situated therin through an employee or through a representative who isn’t an agent of an independent status within the meaning of  paragraph 7.

 

 7.        An enterprise of a  Contracting State shall not be deemed to have a                    permanent establishment in the other Contracting State merely because it carries on business in that other State through a broker, general commission agent or any other agent of an independent status, provided that such persons are acting in the ordinary course of their business . However, when the  activities of such an agent are devoted wholly or almost wholly on behalf of that enterprise or its associated enterprises, he will not be considered an agent of an independent status within the meaning of this  paragraph .

 

8.         The fact that a company which is a resident of  a Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other State ( whether through a permanent establishment or otherwise ), shall not of itself constitute either company a permanent establishment of the other .

 Article  6

INCOME FROM IMMOVABLE PROPERTY

 1.       Income derived by a resident of a Contracting State from immovable property ( including income from agriculture or forestry ) situated  in the other Contracting State may be taxed in that other State .

 2.         The term " immovable property " shall have the meaning which it has under the law of the Contracting State in which the property in question is situated . The term shall in any case include property accessory to immovable property, livestock and equipment used in  agriculture and forestry, rights to which the provisions of general law respecting landed property apply, usufruct of  immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work,  mineral deposits, sources and other natural resources ; ships, boats and aircraft shall not be regarded as  immovable property .

 3.         The provisions of paragraph 1 shall also apply to income derived from the direct use, letting, or use in any other form of immovable property.

 

4.         The provisions of  paragraphs 1 and 3  shall also apply to the income from immovable property of an enterprise and to  income from immovable property used for the performance of independent personal services .

Article  7

BUSINESS  PROFITS

 1.                   The profits of an enterprise of a  Contracting State shall  be taxable only in that State unless the enterprise carries on business  in the other Contracting State through a permanent establishment situated therein . If the enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other State but only so much of them as is attributable  to (a) that  permanent establishment; (b) sales in that other State of goods or a merchandise of the same or similar kind as those sold through that permanent establishment; or (c) other business activities carried on that other State of the same or similar kind as those effected through that permanent establishment .   

 

2.         Subject to the provisions of paragraph 3, where an enterprise of a Contracting State  carries on business  in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment the profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment .

 

3.         In determining the profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the  business of the permanent establishment, including executive and general administrative expenses so  incurred, whether in the State in which the permanent establishment is situated or elsewhere . However, no such deduction shall be allowed in respect of amounts, if any, paid (otherwise than towards reimbursement of actual expenses) by the permanent establishment to the head office of the enterprise or any of its other offices, by way of royalties , fees or other similar payments in return for the use of

            patents or other rights, or by way of commission, for specific services performed or for management, or, except in the case of a banking enterprise, by way of interest on moneys lent to the permanent establishment . Likewise , no account shall be taken, in the determination of the profits of a permanent establishment , for amount charged, (otherwise than towards reimbursement of actual expenses), by the permanent establishment to the head office of the enterprise or any of its other offices, by way of royalties, fees or other similar payments in return for the use of patents or other rights, or by way of commission for specific services performed or for management or, except in the case of a banking enterprise, by way of interest or moneys lent to the head office of the enterprise or any of its other offices .

 

4.         For the purpose of  the preceding paragraphs, the profits to be attributed to the permanent establishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary .

 

5.         Where profits include items of income which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected by the provisions of this Article .

 

6.         No profits shall be attributed  to a  permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise .

 Article  8

SHIPPING AND AIR  TRANSPORT

 

1.                   Profits derived by an enterprise of a Contracting State from the operation of ships or aircraft in international traffic shall be taxable only in that State.

 

2.         The provisions of paragraph 1 shall also apply to profits from the participation in a pool, a joint business or an international operating agency.  

 

Article  9

ASSOCIATED ENTERPRISES

 

1.       Where

            a.         an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other  Contracting State, or

            b.         the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and anenterprise of the other  Contracting State,and  in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises,then any profits which would, but for those conditions, have accrued to one of the enterprises, but, by reason of those conditions, have not so accrued, may be included in the profits of that enterprises and taxed accordingly .

2.         Where a Contracting State includes in the profits of an enterprise of that State - and taxes accordingly - profits on which an enterprise of the other  Contracting State has been charged to tax in that other State and the profits so included are profits which would have accrued to the enterprise of the first-mentioned State if the conditions made between the two enterprises had been those which would have been made between independent enterprises, then that other State shall make an appropriate adjustment to the amount of the tax charged therein on those profits . In determining such adjustment, due regard shall be had to the other provisions of the Agreement and the competent authorities of the Contracting States shall if necessary consult each other .

3.         A Contracting State shall not change the profits of an enterprise in the circumstances referred to in paragraph 2 after the expiry of the time limits provided in its tax laws .

4.         The provisions of paragraph 2 shall not apply in the case of tax fraud .

 

Article 10

DIVIDENDS

 

1.         Dividends paid by a company which is a resident of a  Contracting State to  a resident of the other Contracting State may be taxed in that other State .

2.         However, if the beneficial owner of the dividends is a resident of the other  Contracting State, the tax charged by the first mentioned State may not exceed 10 per cent of the gross amount of the dividends actually distributed. This paragraph shall not affect the taxation of the company in respect of the profits out of  which the dividends are paid .

3.         The term "  dividends  " as  used in this Article means income from shares, or other rights, not being debt-claims, participating in profits, as well as income from other corporate rights which is subjected to the same taxation treatment as income from shares by the laws of the State of which the company making the distribution is a resident .

4.         The provisions of  paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a  Contracting State, carries on business in the other Contracting State of which the company paying the dividends is a resident, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment or fixed base . In such case the provisions of  Article 7 or Article 14, as the case may be, shall apply.

Article 11

INTEREST

 

1.         Interest arising in a  Contracting State and paid to  a resident of the other Contracting State may be taxed in that other Contracting State if such resident  is the beneficial owner of the interest .

 

2.         The rate of tax imposed by one of Contracting States on interest derived from sources within that Contracting State and beneficially owned by  resident of the other Contracting State  shall not exceed 10  percent of the gross amount of the interest .

 

3.         Notwithstanding the provisions of paragraph 2, interest arising in a Contracting State and derived by the Government of the other Contracting State including  local authorities thereof, a political subdivision , the Central Bank  or any financial institution controlled by that Government, the capital of which is wholly owned by the Government of the other Contracting State, as may be agreed upon from time to time between the competent authorities of the Contracting States, shall be exempt from tax in the first mentioned State .

 

4.         The term "  interest  " as  used in this Article means income from debt-claims of every kind, whether or not secured by mortgage and whether or not carrying a right  to participate in the debtor's profits, and in particular, income from government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures, as well as income assimilated to income from money lent .

 

5.         The provisions of  paragraphs 1 and 2 shall not apply if the beneficial owner of the interest, being a resident of a  Contracting State, carries on business in the other Contracting State in which the interest arises, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein,  and the debt-claim in respect of which the interest is paid is effectively connected with a) such permanent establishment or fixed base, or with b) business activities referred to under c) of paragraph 1 of  Article 7. In such case ,the provisions of Article 7 or Article 14, as the case may be, shall apply.

 

 6.         Interest shall be deemed to arise in a Contracting State when the payer is that State itself, a political sub-division, a local authority or a resident of that State . Where, however, the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment or fixed base, then such interest shall be deemed to arise in the State in which the permanent establishment or fixed base is situated .

 

7.         Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest, having regard to the  debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of  this Article shall apply only to the last-mentioned amount . In such case, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Agreement.

 

Article 12

ROYALTIES

 

1.         Royalties arising in a  Contracting State and paid to  a resident of the other Contracting State may be taxed in that other Contracting State .

 

2.         The rate of tax imposed by one of Contracting States on royalties derived from source within that Contracting State and beneficially owned by  resident of the other Contracting State  shall not exceed  10 percent of the gross amount of the royalties described in paragraph 3 .

 

3.                     The term "royalties" as  used in this Article means payments, whether periodical or not, and in whatever form or name or nomenclature to the extent to which they are made as consideration for :

 

            a.         the use of, or the right to use, any copyright, patent, design or model, plan, secret formula or process, trademark or other like property or right;  or

            b.         the use of, or the right to use, any industrial, commercial, or scientific equipment, or

            c.         the supply of scientific, technical, industrial or commercial knowledge or information ; or

            d.         the supply of any assistance that is ancillary and subsidiary any such      property or right as is mentioned in sub-paragraph (a) , any such equipment as is mentioned in sub-paragraph (b), or any such knowledge or information as is mentioned in sub-paragraph (c); or

            e.         the use of, or the right to use:

                                    i.          motion picture films; or

                                    ii.         films or video for use in connection with television; or

                                    iii.       tapes for use in connection with radio broadcasting ;or

            f.          total or partial forbearance in respect of the use or supply or any  property or right referred to in this paragraph.

 

4.         The provisions of  paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties, being a resident of a  Contracting State, carries on business in the other Contracting State in which the royalties arise, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein,  and the right or property in respect of which the royalties are paid is effectively connected with a) such permanent establishment or fixed base, or with b) business activities referred to under c) of paragraph 1 of  Article 7. In such case ,the provisions of Article 7 or Article 14, as the case may be, shall apply.

 

5.         Royalties shall be deemed to arise in a Contracting State when the payer is that State itself, a local authority or a resident of that State . Where, however, the person paying the royalties, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the liability to pay the  royalties was incurred, and such  royalties are borne by such permanent establishment or fixed base, then such royalties shall be deemed to arise in the State in which the permanent establishment or fixed base is situated .

 

6.         Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the royalties, having regard to the use, right or information for which they are paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of  this Article shall apply only to the last - mentioned amount . In such case, the excess part of the payment shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Agreement.

Article 13

CAPITAL GAINS

 

1.       Gains derived by a resident of a Contracting State from the alienation of immovable property referred to in Article 6 and situated in the  other Contracting State may be taxed in that other State .

2.                     Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, including such gains from   the alienation of  such  a  permanent  establishment  ( alone or with the whole enterprise ) or of such fixed base, may be taxed in that other State .                

3.         Gains derived by an enterprise of a Contracting State  from the alienation of ships or aircraft operated in international traffic or movable property pertaining to the operation of such ships or aircraft shall be taxable only in that State .

4.         Gains from   the alienation of any property other than that referred to in the preceding paragraphs shall be taxable only in the Contracting  State  where the gains arise.                

Article 14

INDEPENDENT PERSONAL SERVICES

 

1.       Income derived by a resident of a Contracting State in respect of professional services or other activities of an independent character shall be taxable only in that State, unless he has a fixed base regularly available to him in the other Contracting State for the purpose of performing his activities or he is present in that other State for period or periods exceeding in the aggregate 90  days within any twelve-month period .If he has such a fixed base or remains in that other State for the aforesaid period or periods, the income may be taxed in that other State but only so much of it as is attributable to that fixed base or is derived in that other State during the aforesaid period or periods.

 

2.         The term " professional services " includes especially independent scientific, literary, artistic, educational or teaching activities as well as the  independent activities of physicians, lawyers, engineers, architects, dentists and accountants .

Article 15

DEPENDENT PERSONAL SERVICES

1.         Subject to the provisions of  Articles 16, 18,19 and 20, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State . If  the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State.

2.         Notwithstanding the provisions of paragraph 1,  remuneration derived by a resident of a Contracting State in respect of an employment  exercised in the other Contracting State shall be taxable only in the  first-mentioned State if :

            a)         the recipient is present in that other State for a period or periods not exceeding in the aggregate 183 days within any twelve-month  period; and

            b)         the remuneration is paid by, or on behalf of, an employer who is not     a resident of the other State; and

             c)         the remuneration is not borne by     a permanent establishment or a                    fixed base which the employer has in the other State .

3.         Notwithstanding the preceding provisions of this Article,   remuneration derived in respect of an employment  exercised aboard a ship or aircraft operated in international traffic, by an enterprise of  a  Contracting State shall be taxable only in that State  .

 Article 16

DIRECTOR'S FEES

 

                                     Director's fees and other similar payments derived by a resident of a Contracting State in his capacity as a member of the board of directors  or any other similar organ of a company which is a resident of the other Contracting State may be taxed in that other  Contracting State .

 Article 17

 ARTISTES AND ATHLETES

  

1.         Notwithstanding the provisions of  Articles 14 and 15, income derived by a resident of a Contracting State as an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as an athlete, from his personal activities as such exercised in the other Contracting State, may be taxed in that other State.

 2.         Where income in respect of personal activities exercised by an entertainer, or an athlete in his capacity as such accrues not to the entertainer or athlete himself but to another person, that income may, notwithstanding the provisions of  Articles 7, 14 and 15, be taxed in the Contracting State in which the activities of the entertainer or athlete are exercised.

3.         Notwithstanding the provisions of  paragraphs 1 and 2, income derived  from activities referred to in paragraph 1 performed under a cultural agreement or arrangement between the Contracting States shall be exempt from tax in the Contracting State in which the activities are exercised if the visit to that State is wholly or substantially supported by funds of one or both of  the Contracting States, a local authority or public institution thereof.

 Article 18

PENSIONS AND ANNUITIES

 

1.         Subject to the provisions of  paragraph 2 of Article 19, any pension or other similar remuneration paid to a resident of one of the Contracting States from a source in that other Contracting State in consideration of past employment  or services in the other Contracting State and any annuity paid to such a resident from such a source may be taxed in that other  State .

2.         The term “ annuity “ means a stated sum payable periodically at stated times during life or during a specified or ascertainable period of time under an obligation to make the payments in return for adequate and full consideration in money or money’s  worth .

 Article  19

GOVERNMENT SERVICE

 

1.         a)         Remuneration, other than a pension, paid by a Contracting State or a     political subdivision or a local authority thereof to an individual in   respect of services rendered to that State or subdivision or authority         shall be taxable only in that State.

            b)         However, such  remuneration shall be taxable only in the other    Contracting State if the services are rendered in that other State and             the individual is a resident of that State who :

             i.   is a national of that State; or

           ii. did not become a resident of that State solely for the purpose of rendering the services .                               

    2.      a)         Any pension paid by, or out of funds created by, a Contracting State or a political subdivision or a local authority thereof to an individual  in respect of services rendered to that State or subdivision or local   authority thereof shall be taxable only in that State.

             b)         However, such pension shall be taxable only in the other Contracting    State if the individual is a resident of, and a national of, that other      State.

 3.         The provisions of  Articles 15, 16 and 18 shall apply to  remunerations, and to pensions, in respect of services rendered in connection with a business carried on by a Contracting State or a political subdivision or a local authority thereof .

 Article 20

TEACHERS AND RESEARCHERS

 

                                    An individual who is immediately before visiting  a Contracting State a resident of the other Contracting State and who, at the invitation of the Government of the first-mentioned Contracting State or of a University, college, school, museum or other cultural institution in that first-mentioned Contracting State or under an  official programme of cultural exchange, is present in that Contracting State for a period not exceeding two consecutive years solely for the purpose of teaching, giving lectures or carrying out research at such institution shall be exempt from tax in that Contracting State on his remuneration for such activity, provided that payment of such remuneration is derived by him from outside that Contracting State .

 Article 21

STUDENTS AND TRAINEES

 1.                     Payments which a  student or business  trainee who is   or was immediately before visiting  a Contracting State  a resident of the other Contracting State and who is present in the first-mentioned Contracting State solely for the purpose of his education or training received for the purpose of his maintenance, education or training shall not be taxed in that Contracting State, provided that such payments arise from sources outside that Contracting State .

 2.         In respect of grants, scholarships and remunerations from employment not covered by paragraph 1, a student or business trainee described in paragraph 1 shall, in addition, be entitled during such education or training to the same exemption, reliefs or reductions in respect of taxes available to residents of the  Contracting State which he is visiting .

 

Article 22

OTHER INCOME

                              Items of income of a resident of a Contracting State, which are not expressly mentioned in the foregoing Articles of this Agreement shall be taxable only in that State except that, if such income is derived from sources within the other Contracting State, it may also be taxed in that other State .

 Article  23

METHOD FOR ELIMINATION OF DOUBLE TAXATION

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