Welcoming Senate approval for the U.S. - Sri Lanka Tax Treaty, U.S. Treasury Secretary Snow says, that the tax treaty will expand U.S. economic relations with Sri Lanka, an important trading partner in the developing world Sri Lanka's Envoy to the United States, Ambassador Subasinghe says that the Double Taxation agreement is a milestone in the Sri Lanka U.S. business relationship The United States Senate approved the US-Sri Lanka Double Taxation Agreement and the Protocol Amending the Convention between the Government of Sri Lanka and the US Government for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion on March 26, 2004. The proposed tax treaty with the US was first signed in 1985. The Protocol Amending the Convention between the Government of Sri Lanka and the US Government for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, was signed in Washington DC in September 2002. The agreement with Sri Lanka represents the first tax treaty between the two countries. Welcoming Senate approval for the US-Sri Lanka Tax Treaty, Treasury Secretary Snow said, "[t]his tax treaty will expand our economic relations with Sri Lanka, an important trading partner in the developing world, and is an important step in our ongoing efforts to broaden the reach of our tax treaty network." Sri Lanka's Ambassador to the United States, Ambassador Subasinghe, commenting on Senate approval said, "the conclusion of this Agreement is an important milestone in the developing Sri Lanka -US business relationship benefiting US companies in Sri Lanka and the small but growing Sri Lanka owned companies operating in the US. It is expected to generate greater confidence with US investors wishing to invest in Sri Lanka and would also strengthen the existing framework for the promotion of US investments such as the Bilateral Investment Promotion and Protection Treaty and the Trade and Investment Framework Agreement (TIFA)." Further, the Treaty would expand the ongoing discussions under the US-Sri Lanka Trade and Investment Framework agreement aimed at deepening and diversifying trade between the two countries. The proposed Treaty will relieve Double Taxation both in the United States and Sri Lanka through the Foreign Tax Credit Mechanism. It will also provide for non-discriminatory treatment by one country to residents and nationals of the other. Further, the Treaty includes an exchange of information provisions that generally follows the US Model. Sri Lanka has confirmed its ability to obtain and exchange key tax related information. Following ratification by the Senate, the Treaty and the Protocol will come into force upon a bilateral exchange of Instruments of Ratification. Sri Lanka had previously ratified the agreement. The exchange of instruments of ratification is projected for the second quarter of 2004. Embassy of Sri Lanka Washington DC USA 26 March 2004