The income tax treaty between Ethiopia and Morocco was signed on 19 November 2016. The treaty is the first of its kind between the two countries.
The treaty covers Ethiopian tax on income and profit, and the tax on income from mining, petroleum, and agricultural activities. It covers Moroccan income tax and corporation tax.
The following capital gains derived by a resident of one Contracting State may be taxed by the other State:
Gains from the alienation of other property by a resident of a Contracting State may only be taxed by that State.
Both countries apply the credit method for the elimination of double taxation. A provision is also included for a tax sparing credit for tax that would otherwise be payable but has been reduced or exempted for a limited period of time in a Contracting State in accordance with the laws and regulations of that State for tax incentives.
The treaty will enter into force once the ratification instruments are exchanged. It will apply in Ethiopia from 8 July next following the date of its entry into force and will apply in Morocco from 1 January of the year following its entry in to force.
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