I am afraid that I disagree with this submission

Burton v Commissioner of Taxation decides an appeal to the Australian Full Federal Court. Mr Burton derived as an individual Australian discounted capital gains from investments sold and taxed in the United States, and he expected Australia to offset that US tax against his Australian liability.

The ATO had allowed a FITO only for 50% of US tax on the basis only that proportion of Australian capital gain was taxed in Australia. Mr Burton argued Article 22(2) of the tax treaty required the full FITO be allowed either under Div 770 or the International Tax Agreements Act. Mr Burton appealed to the court to overrule a decision against his arguments in the lower court.

Logan J did not agree with the ATO’s apportionment approach (?62), but concluded that Div 770 and the International Tax Agreements Act did not grant an offset mechanism to Mr Burton. This was in his view not inconsistent with Art 22(2) as Art 22(2) only required a credit or offset in accordance with the law of Australia (?79).

...prior year’s [capital] losses might reduce or even eliminate for foreign tax offset purposes any amount on […] which foreign tax has been paid (Logan J at ?91)

Steward J’s reasoning slightly differed to Logan J's, but concluded similarly. He disagreed with the ATO’s now withdrawn TR 2000/16 which has said Art 22(2) could be applied independently of Div 770 (?142). Art 22(2) is his view obliged Australia to legislate to effect a credit, but as it stands Div 770 or the International Tax Agreements Act do not allow 100% of the FITO. The ATO must apply the domestic law (?144-145).

...the obligation [is] on “Australia” and not on the Commissioner [...] to be discharged by the enactment of domestic legislation [...it] may [...] be open to a citizen of Australia to seek declaratory relief in this Court to determine whether Australia had complied with Art 22(2). (Steward J at  ?145)

Jackson J concluded, similar to the others, on the basis that Div 770 is consistent with the general principles of Art 22(2), and only allowed 50%.