Noting the benefits of Double Taxation Avoidance Convention between India and Mauritius, the SC recently said the recommendations of JPC for incorporating built-in safeguards in the treaty to check tax evasion was for the Parliament to take note of.
Indian companies having their management in the country would be taxed in India as per Indo-Mauritius Double Taxation Avoidance Convention Agreement even if they are incorporated in Mauritius
The government on Tuesday said it has received information related to black money from Mauritius and was examining it for appropriate action.
In a relief to Indian companies, the Income-Tax Department has decided to suspend collection of taxes if the Mutual Agreement Procedure is invoked by a US-based entity under the Indo-US Double Taxation Avoidance Convention. To avoid hardship to taxpayers, the competent authorities of India and the US had entered into a memorandum of understanding regarding suspension of collection during the pendency of MAP in 2003.
Under the amended treaty with Mauritius, for two years beginning April 1, 2017, capital gains tax will be imposed at 50 per cent of the prevailing domestic rate.
Replying to a query, whether the government has made any assessment of black money stashed by Indians in foreign countries, Jaitley said there is no official estimation of that.
The development is expected to pave way for greater transfer pricing cooperation between the two countries, enhance investment flow
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