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13133 World Trade Organization - Tax Riembursement Agreement


   
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TREATIES AND OTHER INTERNATIONAL ACTS SERIES 13133

 

 

TAXATION

Reimbursement

 

 


Agreement Between the
UNITED STATES OF AMERICA
and the WORLD TRADE ORGANIZATION


Signed at Geneva December 22, 2000

with

Annex

 

 


 

NOTE BY THE DEPARTMENT OF STATE

Pursuant to Public Law 89—497, approved July 8, 1966
(80 Stat. 271; 1 U.S.C. 113)—

“. . .the Treaties and Other International Acts Series issued
under the authority of the Secretary of State shall be competent
evidence . . . of the treaties, international agreements other than
treaties, and proclamations by the President of such treaties and
international agreements other than treaties, as the case may be,
therein contained, in all the courts of law and equity and of maritime
jurisdiction, and in all the tribunals and public offices of the
United States, and of the several States, without any further proof
or authentication thereof.”


WORLD TRADE ORGANIZATION

Taxation: Reimbursement

Agreement signed at Geneva December 22, 2000;
Entered into force December 22, 2000.
With annex.

TAX REIMBURSEMENT AGREEMENT BETWEEN THE GOVERNMENT OF THE
UNITED STATES OF AMERICA AND THE WORLD TRADE ORGANIZATION
This Agreement is made between the Government of the United
States of America (hereinafter "United States") and the
World Trade Organization (hereinafter "WTO"), (together
"the Parties").
It is the intent of the United States to assume sole
responsibility pursuant to this Agreement for funding the
reimbursement of taxes to officials of the WTO who are
subject to United States tax law as United States citizens
or permanent resident aliens;
It is the intent of the WTO to place the reimbursement of
United States income tax to its officials on a sound basis;
and
The Parties are desirous of concluding an agreement on
reimbursement to the WTO officials of United States
Federal, state, and local income tax and self-employment
tax levied under United States law on the income they
receive as compensation for official services rendered to
the WTO (hereinafter "institutional income");
THE PARTIES AGREE AS FOLLOWS:
1. The WTO shall reimburse the WTO officials paid from the
regular budget who are liable for and pay the United States
Federal self-employment tax and United States Federal,
state, and local income taxes on their WTO institutional
income, as defined in the Annex to this Agreement, the
amount of those taxes, under the terms and conditions set
forth below. This Agreement does not cover officials paid
from voluntary funds. An advance payment made by the WTO
relating to the estimated tax liability of a staff member
during a current year will be treated as reimbursement,
provided that such payment is effected by an instrument
payable to the Internal Revenue Service or counterpart body
of the taxing state or local government.
2. Subject to the availability of appropriated funds, the
United States shall reimburse the WTO for each taxpayer an
amount not to exceed the tax that would be due if the
specified categories of WTO income were the taxpayer's only
income, taking into account any special tax benefits
available to United States taxpayers employed abroad, as
well as the deductions and personal exemptions otherwise
allowed.
3. The WTO shall inform the officials who seek
reimbursement of taxes that they are obligated to claim all
deductions, exemptions, or exclusions to which they are
entitled under applicable tax legislation and regulations.
4. For purposes of United States Federal income tax,
deductions, exemptions, and adjustments to income shall be
apportioned on a pro rata basis between taxable WTO
institutional income and private income for the purposes of
calculating tax reimbursement, except where deductions and
exemptions relate to a specific category of income.
"Taxable WTO institutional income" means the amount of WTO
income subject to tax after the application of the foreign
earned income exclusion.
5. Both Parties shall take all possible measures to reduce
or eliminate the burden resulting from the cumulative
effect of tax reimbursements being treated as taxable
income. The WTO shall file all tax reimbursement claims
within two calendar years from the date taxes were due or
filed, whichever comes first.
6. The WTO officials who seek reimbursement of taxes are
themselves responsible for complying with any income tax
laws applicable to them; penalties, interest, or other
charges resulting from noncompliance with such laws shall
not be reimbursed by the WTO to the WTO officials and shall
not be reimbursed by the United States to the WTO.
7. The WTO shall require each WTO official claiming tax
reimbursement to determine the status defined by United
States tax law under which that official files an income
tax return, reimbursement being made on the basis of the
status under which taxes are in fact being paid.
2
3
8. The WTO shall maintain separate accounting of the tax
reimbursements covered by this Agreement. The WTO shall
require each official receiving tax reimbursement to
authorize the WTO to obtain confirmation from the United
States Internal Revenue Service and state and local
government counterpart bodies, as appropriate, of the tax
liability of that official and the payment of the tax due.
The WTO shall require each official to provide it with all
the materials necessary to verify that the amounts claimed
under this Agreement from the WTO are the same as the tax
liability the official reports and the tax payments the
official in fact makes.
9. Checks by the WTO for payment of estimated taxes shall
be made payable to the Internal Revenue Service, or
counterpart body of the taxing state or local government,
and checks for reimbursement of taxes already paid by an
official shall be made payable to the official concerned.
10. Reimbursement of the United States Federal self-
employment taxes shall equal the difference between the
amount the official pays as a result of the official's
classification as a self-employed person, less any
applicable tax credit arising from the same qualification,
and the amount the official would have to pay in social
security (Old Age, Survivors and Disability Insurance)
taxes and health insurance (Medicare) taxes were the
official classified as an employee.
11. The principles embodied in the present Agreement on
reimbursement of Federal taxes equally constitute the basis
for the reimbursement of state and local taxes.
12. The United States shall reimburse the WTO on the basis
of a certification that reimbursements have been made by
the WTO to United States citizens, or others who are liable
to pay United States income taxes. The certification shall
set forth the names and United States social security
numbers of the WTO officials reimbursed, the total of the
WTO income against which the United States tax has been
paid (that is, institutional income as defined in the
Annex), the amounts reimbursed to the WTO officials, the
tax year for which reimbursement is made, the year in which
reimbursement is made for each category of tax specified in
Article 1, and affirm that their salaries and benefits are
paid from the regular budget as required by Article 1.
This information shall be provided yearly to the United
States before October first of each year.
13. The United States shall reimburse the WTO at the
earliest possible date following receipt of the
certification specified in Article 12 a sum sufficient to
cover all tax reimbursements paid by the WTO with respect
to preceding tax years, in accordance with this Agreement.
14. Subject to the availability of funds, the United
States and the WTO may agree to a reimbursement for such
reasonable and necessary expenses as the WTO may incur in
connection with the implementation of the administrative
procedures required to carry out the provisions of this
Agreement.
15. This Agreement shall apply with regard to tax
reimbursements for institutional income earned on or after
January 1, 1999.
16. This Agreement shall enter into force upon signature
by the Parties and may thereafter be terminated by either
Party on December 31 of the year following the year in
which notice is given in writing to the other Party, or
when the WTO ceases to exist, whichever comes sooner. If
this Agreement terminates because the WTO ceases to exist,
the United States and the successor in interest to the WTO
or other previously agreed upon designated person shall
determine what arrangements are appropriate to permit
reimbursement of WTO officials as contemplated by this
Agreement.
17. Should the United States conclude a tax reimbursement
agreement with any other international organization
substantially more favorable to that organization or its
officials than the present Agreement, the latter shall be
modified to extend to the WTO the benefit of the former,
subject to the agreement of the United States, which shall
not unreasonably be refused.
4
18. Any difficulties arising from the implementation of
this Agreement shall be resolved by consultations between
the Parties.
Done in duplicate, in the English language, at Geneva,
this 22nd day of December 2000.
FOR THE GOVERNMENT OF THE FOR THE WORLD TRADE
UNITED STATES OF AMERICA: ORGANIZATION:
5
Rita D. Hayes,
Ambassador
Miguel R. Mendoza,
Deputy Director-General
ANNEX
Particulars of Institutional Income
"Institutional income," as used in this Tax Reimbursement
Agreement, includes only the following particulars of
compensation:
-- Basic salary
-- Merit pay
-- Periodic salary increments
-- Special post allowance
-- Overtime
-- Night differential
-- Dependency allowance
-- Education grant and related travel
-- Home leave travel
-- Payments for unused annual leave
-- Termination indemnity
-- Removal cost on appointment
-- Removal cost on separation
-- Installation grant
-- Special post allowance
-- Language allowance
-- Repatriation grant
-- Cost of living adjustment
-- Reimbursement of United States Federal, state, or local
income tax payments and United States self-employment tax
payments on institutional income.
Should the WTO approve the addition, modification, or
deletion of any elements of institutional income, this annex
may be modified by an exchange of letters, subject to the
agreement of the United States, which shall not be
unreasonably refused.



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