The OrganisationOrganization for Economic Co-operation and Development, OECD is an intergovernmental economic organisation with 37 member countries, founded in 1961 to stimulate economic progress and world trade. OECD has come up with a Double Tax Agreement model and in many cases, it is this model that forms the basis of double tax treaties that is adopted by relevant countries. It has undergone various reforms over the years. Singapore and Malaysia, although not strictly members of the OECD, have followed the OECD model for treaty purposes. The basic way in which the OECD model works is to allocate taxing rights in that the country of residence of the taxpayer is required to either grant a credit or an exemption. The other side of the coin is for the country of source to either reduce the scope of its taxes or to cut or reduce the rate of its withholding tax.