1. This Convention shall apply to persons who are residents
of one or both of the Contracting States, except as otherwise
provided in this Convention.
2. This Convention shall not restrict in any manner any
exclusion, exemption, deduction, credit, or other allowance now
or hereafter accorded:
a) by the laws of either Contracting State; or
b) by any other agreement to which the Contracting States are
party.
3.
a) Notwithstanding the provisions of subparagraph b) of
paragraph 2:
aa) the Contracting States agree that any question arising
as to the interpretation or application of the Convention
and, in particular, whether a taxation measure is within
the scope of the Convention, shall be determined
exclusively in accordance with the provisions of Article
25 (Mutual Agreement Procedure) of the Convention;
and
bb) the provisions of any other agreement shall not apply to
a taxation measure unless the competent authorities
agree that the measure is not within the scope of Arti-
cle 24 (Non-discrimination) of this Convention.
b) For the purposes of this paragraph, a “measure” is a law,
regulation, rule, procedure, decision, administrative action,
or any similar provision or action.
4.
a) Except to the extent provided in paragraph 5, this
Convention shall not affect the taxation by the United States
of its residents (as determined under Article 4 (Residence))
and its citizens.
b) Notwithstanding the other provisions of this Convention, a
former citizen or long-term resident of the United States
may, for the period of ten years following the loss of such
status, be taxed in accordance with the laws of the United
States.
5. The provisions of paragraph 4 shall not affect the benefits
conferred by the United States:
a) under paragraph 2 of Article 9 (Associated Enterprises),
paragraph 6 of Article 13 (Gains), paragraphs 3, 4 and 5 of
Article 18 (Pensions, Annuities, Alimony, Child Support, and
Social Security), paragraph 1 and 5 of Article 18A (Pension
Plans), paragraph 3 of Article 19 (Government Service), and
under Articles 23 (Relief from Double Taxation), 24
(Non-discrimination), and 25 (Mutual Agreement Procedure);
and
b) under paragraph 2 of Article18A (Pension Plans), sub-
paragraph b) of paragraph 1 of Article 19 (Government
Service), and under Articles 20 (Visiting Professors and
Teachers; Students and Trainees) and 30 (Members of
Diplomatic Missions and Consular Posts), upon individuals
who are neither citizens of, nor have immigrant status in, the
United States.
6. Nothing in the Convention shall be construed to prevent
the Federal Republic of Germany from imposing its taxes on
amounts included in the income of a resident of the Federal
Republic of Germany according to part 4, 5, and 7 of the
German “Außensteuergesetz”. Where such imposition of tax
gives rise to double taxation, the competent authorities shall
consult for the elimination of such double taxation according to
paragraph 3 of Article 25 (Mutual Agreement Procedure).
7. In the case of an item of income, profit or gain derived by
or through a person that is fiscally transparent under the laws of
either Contracting State, such item shall be considered to be
derived by a resident of a State to the extent that the item is
treated for the purposes of the taxation law of such State as the
income, profit or gain of a resident.