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Israel to Press U.S. to End Policy of Double Taxation

The United States will soon be pressed by Israel to ratify a treaty for the avoidance of double taxation which was drafted 10 years ago but pigeon-holed since then in the U.S. Senate, it was learned here. The question of ratification arose at a three-day conference at Bar Ilan University in Tel Aviv attended by 60 American and Israeli lawyers, accountants and tax experts. The discussions were devoted to taxes on American investments in Israel.

The conference was arranged by the Bar Ilan law faculty and the American-Israel Tax Foundation. The Senate objects to a tax-sparing clause in the draft treaty which would permit American taxpayers to credit taxes paid abroad and tax relief permitted as an investment incentive against their income tax returns.

The clause was first introduced in the tax treaty between the U.S. and Pakistan in 1957 but was deleted by the Senate. The principle, however, has been incorporated by most other countries and the clause was included in treaties Israel has signed with Britain. France, Sweden, West Germany, the Netherlands and Belgium.

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