# Tax Treaty

*Taxes — Finicade finance glossary*

A tax treaty is a bilateral agreement setting which country taxes what when income crosses a border, primarily to prevent the same income being taxed twice. For investors the practical effect is reduced withholding on dividends and interest — often 15% instead of 30%. Treaty shopping, routing income through a country purely for its treaty network, is what anti-abuse provisions now target.

**Also known as:** double taxation agreement, tax convention

**Related terms:** [Double Taxation](https://finicade.com/glossary/double-taxation), [Dividend Withholding Tax](https://finicade.com/glossary/dividend-withholding-tax), [Transfer Pricing](https://finicade.com/glossary/transfer-pricing), [Tax Haven](https://finicade.com/glossary/tax-haven), [American Depositary Receipt (ADR)](https://finicade.com/glossary/american-depositary-receipt)

Source: https://finicade.com/glossary/tax-treaty