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Ottawa, January 25, 2002
2002-007

Protocol to the Tax Convention Between Canada and Australia Signed

Finance Minister Paul Martin today announced that a Protocol to the 1980 Convention between Canada and Australia for the avoidance of double taxation and the prevention of fiscal evasion was signed on January 23, 2002, in Canberra.

The Protocol provides that the rate of withholding tax on dividends between affiliated companies, set at 15 per cent in the 1980 Convention, will be reduced to 5 per cent. The Protocol will also reduce the rate of withholding tax on interest to 10 per cent from 15 per cent and provide an exemption in respect of certain payments made for the use of computer software.

The Protocol will enter into force once Canada and Australia have notified each other that all necessary measures to give the Protocol the force of law have been completed. Its provisions will apply in the calendar year next following that in which the Protocol enters into force.

The full text of the Protocol is available on the Department of Finance Canada Web site at www.fin.gc.ca/treaties/treatystatus_e.html.

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