As Prime Minister Justin Trudeau joined other world leaders in addressing the United Nations General Assembly, behind the glare of the camera lights, Foreign Affairs Minister Stéphane Dion met with Israel’s Finance Minster Moshe Kahlon on the sidelines to sign an agreement to address double taxation in both countries.
The Canada-Israel Double Taxation Agreement will take effect Jan. 1, 2017, and will update an earlier pact on dual taxation dating back to 1976.
The agreement is meant to facilitate bilateral trade and investment, Dion later stated on Twitter.
The deal “allows entrepreneurs and investors to invest in the other country and pay their taxes in only one of them,” said Israeli Ambassador Rafael Barak. “It facilitates and encourages investors to invest and is a good tool to add to the free trade agreement we have between the two countries.”
With developments in online commerce and other ways of providing services, the previous double taxation agreement was becoming dated and in need of revision, Barak said.
The agreement had been negotiated prior to Canada’s last general election in October, but officials were waiting for the right circumstances to sign it. With international leaders in New York for the opening of the UN General Assembly, it was felt the time was right to put pen to paper, Barak said.
An updated version of the Canada-Israel Free Trade Agreement (CIFTA), originally adopted in 1997, is also on the drawing board, the ambassador continued. The revised CIFTA contains chapters on the environment, labour practices and electronic commerce, “things that weren’t there when we signed the agreement,” Barak stated.
“We hope that Mr. Dion comes to Israel and signs it. But that’s the Canadian decision,” Barak said.
Barak, whose term as ambassador concludes at the end of November, said two-way trade between Canada and Israel reached around $1.3 billion last year, but that doesn’t include business generated by Israeli companies based in the Boston area and Silicon Valley, which are selling Israeli-designed products.
“It’s not too much. We know the Canadian government would like to expand [trade]. We see the efforts they’re making with European countries,” he said.
“We in Israel see a very important opportunity,” he said, pointing to Israel’s leadership “in the environment and high-tech solutions.”
Canadians too are looking to expand trade with Israel. Ontario Premier Kathleen Wynne led a business delegation on a visit to the Jewish state in May, and Toronto Mayor John Tory, along with Montreal Mayor Denis Coderre, is scheduled to lead an economic mission there in November.
Barak, who will be replaced as ambassador by veteran diplomat Nimrod Barkan, spoke to The CJN from British Columbia, where the provincial government is planning to send an economic mission to Israel in May, he said.
In other bilateral developments, CIBC, Canada’s fifth-largest bank, said it has formed a strategic partnership with Israel’s Bank Leumi and the National Australia Bank to focus “on delivering new and innovative ways to enhance client experiences.
“The partnership enables three banks on three continents to collaborate and share aspects of their proprietary innovation strategies to enhance their respective client experiences. The partners will share information regarding innovation insights and learnings, co-develop products and services to support and grow their respective client bases, and facilitate the exchange of employee talent in the innovation space,” CIBC said in statement.