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1. GENERAL REMARKS

Belgium has concluded bilateral Conventions for the avoidance of double taxation with the Grand-Duchy of Luxemburg, France and Italy. Ratifications have so far been exchanged with the Grand-Duchy and Italy.

The texts of these Conventions are not uniform, for the fiscal systems of the four contracting States are in certain respects so different that no one solution could be found wholly acceptable to each of them.

Nevertheless, the provisions are substantially the same as far as concerns liability to tax on income from land and buildings, the taxation of the income of industrial, mining, commercial or agricultural enterprises, income from labour, fees of directors and auditors of share companies, public and private pensions and annuities.

The taxation of income from securities is not dealt with in the Convention with the Grand-Duchy of Luxemburg owing to fundamental differences in the fiscal treatment of such income by the two countries. It was omitted from the Convention with Italy because the interests affected are of very secondary importance. On the other hand, the question has been amply treated in the and private Convention with France.

DEFINITION OF FISCAL DOMICILE

The Conventions define fiscal domicile as follows: The fiscal domicile of individuals is the place where they normally reside — that is, where they have a permanent home. Companies and partnerships having a separate legal entity are domiciled for fiscal purposes in the place where they have their real head office; the fiscal domicile of other legal entities is their real centre of direction or management.

From the standpoint of Belgian law, therefore, the conception that determines the fiscal domicile of individuals is residence (see page 49); in the case of companies and partnerships with a separate legal entity, the determining factor is their real head office, which is usually synonymous with the principal establishment as laid down by Belgian fiscal law. The real centre of direction or management, constituting the fiscal domicile of other legal entities, likewise coincides with the principal establishment as understood by Belgian jurisprudence.

From this point of view, the Conventions do not introduce any essentially new principle into co-ordinated Belgian law.

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