New Japan-Spain tax treaty signed

Japan and Spain have signed a new tax treaty, the Japanese Ministry of Finance today announced.

The treaty, which is not yet in force, would amend the countries’ 1974 agreement, reducing withholding taxes on interest and royalties from 10 percent to zero. Dividends would be exempt from withholding if paid to a holder of at least 10 percent of the voting power for 12 months. In other cases, dividends would be subject to withholding at a 5 percent rate.

The treaty also introduces measures to prevent tax treaty abuse and arbitration of tax disputes.