Press Release
December 14, 2015

Tax treaties with Turkey, Italy and Germany
to prevent double income taxation

The Senate today concurred in the ratification of tax treaties between the Philippines and the governments of Turkey, Italy and Germany.

Senator Juan Edgardo "Sonny" Angara, sponsor of Senate Resolution No. 1540, 1541 and 1542, said the ratification of the tax treaties seek to avoid instances of double income taxation which "poses a considerable barrier to trade and investment."

Senate President Franklin M. Drilon said that the measure is part of the Senate's efforts to help make a better business climate for the country and improve its economic policies, particularly in enhancing the flow of more foreign-direct investments (FDI) into the local economy.

Angara said that the treaties will help build an enabling environment and investment climate that is more attractive to new businesses and ventures, particularly from Germany, Italy and Turkey.

In his sponsorship speech, Angara said Germany was the Philippines' top trading partner in Europe and 8th worldwide with bilateral trade amounting to $5.346 billion in 2014. On the other hand, Italy was the country's 7th highest trading partner in Europe and 24th worldwide with bilateral trade amounting to $542 million for the same period, with Turkey as the 14th largest trading partner in Europe and 41st worldwide with the bilateral trade amounting to $138.76 million.

"These agreements were undertaken to better enforce domestic laws, reduce tax evasion, promote technology transfer and guarantee that Philippine tax laws are compliant with internationally agreed standards," Angara said.

With the special authority of President Benigno S. Aquino III, Finance Secretary Cesar Purisima signed the tax agreements with Germany (SRN 1542) on September 9, 2013 in Berlin, Germany, and with Italy (SRN 1541) on December 9, 2013 in Manila, Philippines. Then Foreign Affairs Secretary Alberto G. Romulo signed the tax agreement with Turkey (SRN 1540) on March 13, 2009 in Ankara, Turkey on behalf of the Philippine government.

"The Senate concurring in the ratification serves as the stimuli for encouraging and supporting new trade and investments into the country," Angara said. (Apple Buenaventura)

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