In accordance with the territoriality principle, nonresident entities are liable for tax in Venezuela only on income de-rived from Venezuelan sources. When fees are paid to nonresidents for technical assistance and technological services rendered abroad but used in Venezuela, a proportion of the gross income is deemed to be realized in Venezuela and charged to tax. The taxable proportion in the case of technical assistance and technological services is 30%. See Table A in "TAXATION OF RESIDENT ENTITIES" for applicable rates. Thus, if the rate is 34%, tax is in effect levied at 10.2% on gross income for technical assistance and technological services. The tax is charged by way of withholding.

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