This chapter thoroughly examines the substantive role and inherent attributes of tax carve-out clauses in International Investment Agreements (IIAs), emphasizing their critical importance in the relationship between International Investment Law and International Tax Law. These provisions are strategically designed to exclude taxation matters from the scope of IIAs. Nonetheless, the inconsistency in their drafting and the usage of imprecise terminology in the design of these clauses present interpretational concerns. This analysis, therefore, explains the crucial role of tax carve-out clauses within the context of IIAs.