Hong Kong and the Republic of Korea, on July 8, signed an agreement for the avoidance of double tax and fiscal evasion with respect to taxes on income.
Under the agreement, the Korean withholding tax on interest, which currently ranges from 14 to 20 percent, is reduced to 10 percent; the Korean withholding tax on royalties is reduced from 20 percent to 10 per cent; and the Korean dividends withholding tax is reduced from 20 per cent to 10 or 15 percent, depending on percentage of shareholdings.
Other provisions specify taxation of Hong Kong airlines operating in Korea and profits from international shipping arsing in Korea.
The agreement includes an article on exchange of tax information.
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