Hong Kong has signed an agreement with Austria to avoid double taxation and prevent fiscal evasion regarding income and capital taxes, according to Tax-News.com.

This is the eleventh comprehensive agreement for the avoidance of double taxation concluded by Hong Kong.

Hong Kong, along with a number of such financial jurisdictions, has been signing such DTAs and stamping out tax evasion so that it does not get blacklisted as a so-called tax haven. Switzerland, for example, has inked a number of DTAs with countries both in Europe and other parts of the world.

The agreement applies to taxes on profits, salaries and property in the case of the Hong Kong Special Administrative Region; and, in the case of Austria, on income tax, corporation tax, land tax, tax on agricultural and forestry enterprises and tax on the value of vacant plots. It applies also to any identical or substantially similar future taxes.

Article 8 contains special provisions for shipping and air transport; profits from the operation of ships or aircraft in international traffic, including lease income and container leases, are taxable only in the country of the owner.

Interest income withholding tax is set at zero in the country of the payer, while dividend income is set at a maximum of 10 per cent. Withholding tax on royalty income is similarly limited to a maximum of 3 per cent.