Kill-Switches in the New U.S. Model Tax Treaty

39 Pages Posted: 18 May 2016 Last revised: 10 Jan 2018

See all articles by Allison Christians

Allison Christians

McGill University - Faculty of Law

Alexander Ezenagu

McGill University, Faculty of Law, Students

Date Written: May 15, 2016


The new US model income tax treaty contains an unusual addition: mechanisms for the parties to unilaterally override the negotiated treaty rates in specified circumstances. Previewed last year in proposed form — a first for Treasury — these new mechanisms work as kill-switches, partially terminating the treaty as to one or both treaty partners. The idea is to forestall a more problematic outcome, such as an enduring breach of one of the parties’ expectations, or the opposite, a complete termination of all the treaty terms in the face of such a breach. Yet embedding a kill-switch in a treaty creates distinct legal, procedural, and political pressures in the tax-treaty relationship that implicate treaty negotiation, ratification, interpretation, and dispute resolution. Kill-switches also communicate a defensive tenor in the tax treaty relationships among many countries. This Article analyzes the new kill-switch provisions and concludes that their introduction in the U.S. Model reflects the steady deterioration of tax treaties from essentially diplomatic documents premised on the good faith of the parties to detailed contracts drafted in anticipation of the opposite.

Keywords: taxation, treaties, international law, tax policy, treaty disputes

JEL Classification: E62, H2, K34, F02, F23, F42, H87, K33, D78

Suggested Citation

Christians, Allison and Ezenagu, Alexander, Kill-Switches in the New U.S. Model Tax Treaty (May 15, 2016). Brooklyn Journal of International Law, Vol. 41, 2016. Available at SSRN: or

Allison Christians (Contact Author)

McGill University - Faculty of Law ( email )

3644 Rue Peel
Montréal, Quebec

Alexander Ezenagu

McGill University, Faculty of Law, Students ( email )

Montréal, Quebec

Register to save articles to
your library


Paper statistics

Abstract Views
PlumX Metrics