3 Where a person other than a natural person resides in both States Parties pursuant to paragraph 1 above, the competent authorities of the States Parties shall endeavour to settle the matter by mutual agreement. In the absence of such a convention, that person shall not be considered to be resident in any of the States Parties for the purposes of articles 6 to 21, including and article 23. I do not know whether, in Sweden, there is the same system of individual taxation for individuals, which stems from dividends paid by companies. Here, as in England, the dividend paid by a company is obviously paid with tax deduction; the tax has already been paid by the undertaking concerned. It is therefore treated here as taxable income even before it is received by the beneficiary. I do not know whether Sweden applies the same principle as between corporate taxation on the one hand and individual income tax on the other. I think I am right that this does not apply to the United States of America; in the United States of America, the exemption is granted only for a portion of the tax it incurs before the person derives his dividend from it. The operation of this part of the agreement must therefore depend entirely on how the general structure of Swedish income tax is used. The provisions of this paragraph shall not affect the taxation of the profits of the company from which the dividends are paid.
As I understand it, the credit system has allowed us to offset in Sweden not only the taxes incurred here, but also the taxes that would have been generated by the fact that we would not have received the incentives offered by the 1956 Finance Act that I introduced and which was extended and improved by the current Minister in subsequent legislation. After this principle has been recognized here, it appears b 1 If a person considers that the acts of one or both Contracting States will result or will result in taxation which is not in conformity with the provisions of this Convention, he may, irrespective of the remedies provided for by the national laws of those States, be addressed to the competent authority of the Contracting State: in which it is established to submit a written request stating the reasons for the request for review of that taxation. (b) Subject to the existing provisions of Canadian law relating to the taxation of the income of a foreign subsidiary and a subsequent amendment to those provisions – which does not affect the general principle of those provisions – for the purpose of calculating Canadian tax, a corporation established in Canada may, in computing its taxable income, receive the dividend it has received on the excess exempt from a foreign tax from one corporation to another. which is established in Sweden. . . . .