On 24 January, 2013, the United States and Japan signed a new Protocol (the 2013 Protocol or Protocol), amending the current Income Tax Treaty between the two countries signed on 6 November, 2003 (the 2003 Treaty or the Treaty).

The 2013 Protocol updates a number of provisions of the 2003 Treaty making them similar to more recent US bilateral tax treaties.

Key items of the Protocol include:

• Liberalized holding period provision and ownership percentage requirements for qualification for the dividend withholding tax exemption
• General exemption on cross-border interest payments
• Mandatory binding arbitration procedures
• Revised exchange of information provisions to facilitate the administration of each country’s tax laws
• Expanded and strengthened provisions regarding assistance in the collection of taxes

Further details are available from the Ernst & Young Tax Alert which can be accessed using the link below:

• US Japan Protocol amends 2003 Income Tax Treaty between the United States and Japan (PDF, 693 KB)

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