New Delhi:
The Finance Ministry Monday said that India and China have amended the bilateral tax treaty which will help prevent tax evasion by allowing exchange of information to latest international standards.
The Protocol was signed between the Indian Government and the People's Republic of China on November 26 with an aim to avoid double taxation and to prevent of fiscal evasion.
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“The Government of the Republic of India and the Government of the People’s Republic of China have amended the Double Taxation Avoidance Agreement (DTAA) for the avoidance of double taxation and for the prevention of fiscal evasion with respect to taxes on income,” said the Ministry tweeted.
The Government of the Republic of India and the Government of the People’s Republic of China have amended the Double Taxation Avoidance Agreement (DTAA) for the avoidance of double taxation and for the prevention of fiscal evasion with respect to taxes on income,
— Ministry of Finance (@FinMinIndia) November 26, 2018
The Protocol incorporated changes required to implement treaty-related minimum standards under the Action reports of Base Erosion & Profit shifting (BEPS) Project.
Besides minimum standards, the Protocol brings in changes as per BEPS Action reports as agreed upon by the two sides, the ministry added.
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The Union Cabinet chaired by Prime Minister Narendra Modi approved the signing and ratification of the protocol amending the 'Agreement' of the two nations on February 7, 2018, it said.
Under Section 90 of the Income-tax Act, 1961, India can enter into an agreement with a foreign country or specified territory for avoidance of double taxation of income, for exchange of information for the prevention of evasion.
(With PTI inputs)
