Rev. Rul. 55-482

Reconsideration has been given Rev. Rul. 54-475, C. B. 1954-2, 11. The chart contained therein indicates that under the United States-Canada income tax convention, Treasury Decision 6047, C. B. 1953-2, 59, copyright royalties are subject to withholding at the rate of 15 percent. Article XIII C of the convention reads as follows:

Royalties for the right to use copyrights or in respect of the right to produce or reproduce any literary, dramatic, musical, or artistic work (but not inclusive of rents or royalties in respect of motion picture films) derived from sources within one of the contracting States by a resident or corporation or other entity of the other contracting State not engaged in trade or business in the former State through a permanent establishment shall be exempt from tax imposed by such former State.

Accordingly, the royalties column opposite Canada in Rev. Rul. 54-475, supra, is hereby modified to eliminate in that column reference to footnote 2 and substitute therefor a reference to footnote 13. There is added a new footnote 13 which reads as follows:

13 Copyright royalties are exempt from tax and withholding provided the taxpayer has no permanent establishment in the United States.

Release of excess tax withheld, and exemption from, or reduction in rate of, withholding tax at source in the case of residents of the Netherlands Antilles, as affected by the income tax convention between the United States and the Netherlands. See T. D. 6153, page 777