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Ottawa, August 29, 1996 Tax Convention Signed by Canada and Republic of LithuaniaRelated document: Finance Minister Paul Martin today announced that a Convention between Canada and the Republic of Lithuania for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital was signed on August 29, 1996, at Vilnius. The Convention was signed on behalf of Canada by the Minister of Foreign Affairs, Lloyd Axworthy, and on behalf of the Republic of Lithuania by the Minister of Foreign Affairs, Povilas Gylys. The Convention is patterned to a large extent on the model double taxation convention prepared by the Organisation for Economic Co-operation and Development. Under the Convention, a general rate of withholding tax of 5 per cent will apply to dividends paid to a parent company and on branch profits and of 10 per cent on interest and royalties. The rate of withholding tax on other dividends is set at 15 per cent. The Convention also provides for a number of exemptions in the case of interest. The Convention will enter into force after Canada and the Republic of Lithuania have notified each other of the completion of the procedures required by law for its bringing into force and its provisions will have effect from the first day of January of the calendar year next following that in which the later of the notifications has been given. ___________________ Jean-Marc Déry |
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