(1) Tax shall be determined in the case of a resident of
the Federal Republic of Germany as follows:
(a) Unless the provisions of sub-paragraph (b) apply,
there shall be excluded from the basis upon which
German tax is imposed, any item of income derived
from sources within Jamaica and any item of capital
situated within Jamaica, which, according to this
Agreement, may be taxed in Jamaica. The Federal
Republic of Germany, however, retains the right to
take into account in the determination of its rate of
tax the items of income and capital so excluded. In
the case of income from dividends the foregoing
provisions shall apply only to such dividends as are
paid to a company being a resident of the Federal
Republic of Germany by a company being a resident
of Jamaica if at least 25 per cent of the voting shares
of the Jamaican company is owned directly by the
German company. There shall also be excluded from
the basis upon which German tax is imposed any
shareholding, the dividends of which, if paid, would
be excluded from the basis upon which tax is impos-
ed according to the immediately foregoing sentence.
Subject to the provisions of German tax law regard-
(b
=
ing credit for foreign tax, there shall be allowed as a
credit against German income and corporation tax,
including the surcharge thereon, payable in respect
of the following items of income derived from sour-
ces within Jamaica the Jamaican tax paid unter the
laws of Jamaica and in accordance with this Agree-
ment on:
(aa) dividends not dealt with in sub-paragraph (a) to
which sub-paragraph (b), paragraph (2), of Arti-
cle 10 applies;
(bb) interest to which paragraph (2) of Article 11
applies;
(cc) royalties to which paragraph (2) of Article 12
applies;
(dd) gains to which paragraph (3) of Article 13 ap-
plies;
(ee) remuneration to which Article 16 applies;
(ff) income to which Article 17 applies.
The credit shall not, however, exceed that part of the
German tax, as computed before the credit is given,
which is appropriate to such items of income.
(c) If in the cases (aa), (bb), and (cc) of sub-paragraph
(b) above Jamaican tax on dividends, on interest, or
on royalties in the meaning of paragraph (3) of Arti-
cle 12 is wholly relieved or reduced below the rates
of tax provided for in Articles 10, 11 or 12, by special
incentive measures under Jamaican law designed to
promote economic development in Jamaica, there
shall be allowed as a credit against German income
tax and corporation tax, including the surcharge
thereon, on such dividends, interest or royalties an
amount corresponding to the rate of tax provided for
in the respective Articles. The credit allowed under
the foregoing sentence shall, however, not exceed
the amount of Jamaican tax which would have been
payable but for such reduction.
(2) Subject to the provisions of the law of Jamaica re-
garding the allowance as a credit against Jamaican tax
of
tax payable in a territory outside Jamaica (which
shall not affect the general principle hereof):
(a
) German tax payable under the laws of the Federal
Republic of Germany and in accordance with this
Agreement, whether directly or by deduction, on
profits or income from sources within the Federal Re-
public of Germany (excluding in the case of a divi-
dend, tax payable in respect of the profits out of
which the dividend is paid) shall be allowed as a
credit against any Jamaican tax computed by refer-
ence to the same profits or income by reference to
which the German tax is computed.
(b
) Where a company which is a resident of the Federal
Republic of Germany pays a dividend to a company
resident in Jamaica and which controls directly or
indirectly at least 25 per cent of the voting shares in
the first-mentioned company, the credit shall take
into account (in addition to any German tax for
which credit may be allowed under sub-paragraph (a)
of this paragraph) the German tax payable by that
first-mentioned company in respect of the profits out
of which such dividend is paid.
(c
~—
For the purpose of this paragraph the term “ German
tax“ shall not include the Gewerbesteuer (trade tax)
computed on a basis other than profits or the Ver-
mögensteuer (capital tax).
(d
=
For the purpose of this paragraph, profits or re-
muneration for personal (including professional) ser-
vices performed in a Contracting State shall be
deemed to be income from sources within that State.