The State Taxation Administration ("STA") has recently issued the Announcement on the Effectiveness and Implementation of the Fourth Protocol to the Arrangement between the Mainland of China and the Macao Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income (the "Announcement").
According to the Announcement, the Fourth Protocol introduces to the Arrangement between the Mainland of China and the Macao Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, as well as the related protocols, some revisions including incorporating the fruits concerning Base Erosion and Profit Shifting (BEPS) and adding a new article in respect of government investment. The former includes the foreword, persons covered, resident, permanent establishment, capital gains, and entitlement to benefits under the arrangement. The Fourth Protocol shall come into force on May 14, 2020, as stipulated. The provisions of Article 6 thereof shall apply to income paid on or after May 14, 2020, while the provisions of other articles shall apply to income derived in the taxable years beginning on or after January 1, 2021.