Abstract

This chapter examines two broad areas of capital gains tax (CGT) design in respect of the taxation of non-residents. The first area relates to the domestic design of the tax and focuses on whether a CGT should apply comprehensively to all assets held by non-residents, or alternatively, to some limited subset of those assets. Is there any justification for limiting the scope of CGT to only certain types of assets when such assets are held by non-residents as opposed to residents? The second area is how double tax agreements (DTAs) interact with, or change, domestic CGT taxing rights. This area is intricately connected with the first area because the role of a DTA is to limit the taxing rights of contracting states primarily to avoid or reduce double taxation. Keywords: capital gains tax; non-residents taxation; double tax agreements; international tax system design