Tax sparing definition

Tax sparing is a means by which the tax system of a capital-exporting country can be made to accommodate the tax incentives of developing countries. More specifically, in this case, Japan "spares" the tax it would normally impose on the untaxed (or low-taxed) income earned by Japanese investors in Pakistan by granting them foreign tax credits equal to the tax they would have paid in Pakistan (in the absence of the incentives). Japan's bilateral tax treaties with Sri Lanka, Zambia, Brazil, Pakistan, the Philippines, China, Thailand, Bangladesh, and Viet Nam have tax sparing provisions.

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Tax sparing is a means of ensuring that the relief associated with tax incentives offered by developing countries to foreign investors is not offset by taxation in those investors' country of residence owing to the latter's use of the credit method for relieving international double taxation.

Tax sparing is a means by which the tax system of a capital-exporting country can be made to

Examples of Tax sparing in a sentence

Tax sparing provisions are mainly to be found in tax treaties between developed and developing countries.
Target and each of its subsidiaries are in material compliance with all terms and conditions of any Tax exemptions or other Tax- sparing agreement or order of a foreign government.
To the knowledge of Graduate or any of its Subsidiaries, each of Graduate and its Subsidiaries is in material compliance with all terms and conditions of any Tax exemption, Tax holiday or other Tax sparing agreement or order of any Governmental Entity and the consummation of the transactions referenced in this Agreement will not have any adverse effect on the continued validity and effectiveness of any such Tax exemption, Tax holiday or other Tax-sparing agreement or order.
The Company is in compliance in all material respects with all terms and conditions required to maintain such Tax exemption, Tax holiday or other Tax-sparing arrangement and the consummation of the transactions contemplated hereby will not have any adverse effect on the continuing validity and effectiveness of any such Tax exemption, Tax holiday or other Tax- sparing arrangement or order.
Tax sparing is granted by the Canada in respect of certain exemptions from and reductions in Chinese tax.

More Definitions of Tax sparing

Tax sparing is a means by which the tax system of a capital-exporting country can be made to accommodate the tax incentives of developing countries. More specifically, in this case, Japan "spares" the tax that it would normally impose on the untaxed (or low-taxed) income earned by its investors in India by granting them foreign tax credits equal to, or possibly greater than, the tax they would otherwise have paid in India (in the absence of the incentives).