What is a Tax Treaty?

Understanding Tax Treaties and Their Importance

Introduction

In the intricate world of international finance, tax treaties play a crucial role in mitigating double taxation and fostering equitable tax practices between nations. A tax treaty is a bilateral agreement established between two countries to address issues of double taxation, ensuring that individuals and businesses are not subject to paying taxes on the same income or capital in both jurisdictions. This article delves into the nature and significance of tax treaties, providing insights into their implications for businesses, investors, and individuals navigating cross-border tax matters.