FROM THE OFFICE OF PUBLIC AFFAIRS

The Treasury Department announced the entry into force and effective dates of seven income tax agreements to which the U.S. Senate gave advice and consent to ratification on October 31, 1997.

On December 28, 1997, the bilateral tax treaty between the United States and South Africa entered into force. The treaty applies, with regard to taxes withheld at source, in respect of amounts paid or credited on or after January 1, 1998 and, with regard to other taxes, in respect of taxable periods beginning on or after January 1, 1998. The treaty replaces a previous treaty that was terminated in 1987 pursuant to the U.S. Anti-Apartheid Act.

Instruments of ratification were exchanged in Washington on December 15, 1997 with respect to a bilateral tax treaty between the United States and the Kingdom of Thailand. This is the first tax treaty between the two countries, and generally will be effective, with respect to taxes withheld at source, for amounts paid or credited on or after June 1, 1998 and, for other matters, for taxable periods beginning on or after January 1, 1998.

The fourth protocol to the bilateral tax convention between the United States and Canada entered into force on December 16, 1997 upon the exchange of instruments of ratification in Washington. Article 1 of the Protocol, relating to the taxation of certain real property gains, will have effect as of April 26, 1995. Article 2 of the Protocol, relating to the taxation of social security benefits, generally will have effect with respect to amounts paid or credited after December 31, 1995.

Instruments of ratification were exchanged in Washington on December 17, 1997 with respect to a bilateral tax treaty, protocol and memorandum of understanding between the United States and Ireland. The new treaty replaces the 1949 tax treaty between the two nations. In general, it will have effect, with respect to taxes withheld at source, for amounts paid or credited on or after January 1, 1998 and, for other taxes, with respect to taxable years beginning on or after January 1, 1998.

On December 19, instruments of ratification were exchanged with respect to three agreements. In Bern, instruments were exchanged with respect to a bilateral tax treaty and protocol between the United States and Switzerland. In Washington, instruments were exchanged with respect to bilateral tax treaties between the United States and Austria and the United States and Turkey.

The new treaty with Switzerland replaces a 1951 treaty. It generally will have effect, with respect to taxes withheld at source, for amounts paid or credited on or after February 1, 1998. In other cases the treaty generally will have effect with respect to taxable years beginning on or after January 1, 1998.

The Austrian treaty replaces an existing treaty which has been in place since 1957 and will enter into force on February 1, 1998. Provisions relating to taxes withheld at source generally will be effective for payments made on or after April 1, 1998. Provisions relating to other taxes generally will be effective on January 1, 1999.

The treaty with Turkey is the first between the two countries. It will have effect with respect to taxes withheld at source, for amounts paid or credited on or after January 1, 1998, and for other purposes, for taxable years beginning on or after January 1, 1998. This treaty completes the U.S. network of treaties with OECD member countries.