18-02-2012 / 2012 - Red Card Article 17? - Bulletin for International Taxation

The International Bureau for Fiscal Documentation (IBFD) has published the article "Red Card Article 17?" in the March 2012 issue of the tax magazine Bulletin for International Taxation.

Authors of the article are Dick Molenaar (All Arts Tax Advisers and Erasmus University Rotterdam), Mario Tenore (Maisto e Associati, Italy) and Richard Vann (Challis Professor of Law, University of Sydney, Australia). The article is based on Seminar E of the 2010 IFA Congress in Rome, which had the same title and discussed the developments around Art. 17 of the OECD Model Tax Convention (artistes and sportsmen). In 2010 the OECD had published a Discussion Draft, in which changes in the Commentary on Art. 17 were proposed, but reactions on this Draft demanded a new and more fundamental approach towards the article. The seminar was devoted to both aspects.

The IFA organized the seminar together with the OECD, the organisation in Paris which coordinates the international tax treaties. At the moment the OECD discusses the future of Art. 17. How can the avoidance behaviour of top artistes and sportsmen still be counteracted, but also be prevented that the big group of normal artistes and sportsmen do not suffer from the harsh tax measures? In the mean time already 2/3 of the bilateral tax treaties include the exemption of Art. 17(3) for subsidized artiestes and sportsmen, big sports events are tax exempt (Olympics, Champions League Final, EURO 2012, 2011 ICC World Cup Cricket and 2011 World Cup Rugby) and the Netherlands have given up their source withholding tax as of 2007. This means that there is a tendency towards improvement.

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