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    Jan 18, 2010

    INDIA AND FINLAND SIGNED REVISED DOUBLE TAXATION AVOIDANCE AGREEMENT(DTAA)

    Revised Agreement and Protocol signed between the Republic of India and the Republic of Finland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (DTAA)



    No.402/92/2006-MC (03 of 2010)
    Government of India / Ministry of Finance
    Department of Revenue
    Central Board of Direct Taxes
    ***
    New Delhi dated the 15th January 2010
    PRESS RELEASE
    A revised Agreement and Protocol between the Republic of India and the Republic of
    Finland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect
    to Taxes on Income (DTAA) was signed by Sh. S.S.N.Moorthy, Chairman, CBDT on behalf of
    Government of India and Ms Terhi Hakala, the Ambassador of Finland to India, on behalf of
    Government of Finland.

    2. As per the revised Agreement, withholding tax rates have been reduced on dividends
    from 15 percent to 10 percent, and on royalties and fees for technical services from 15 or 10
    percent to a uniform rate of 10 percent. Lowering of withholding tax will promote greater
    investments, flow of technology and technical services between the two countries.

    3. The revised Agreement also expands the ambit of Article concerning Exchange of
    Information to provide effective exchange of information in line with current international
    standards. The Article inter-alia provides that a Contracting State shall not deny furnishing of
    the requested information solely on the ground that it does not have any domestic interest in that
    information or such information is held by a bank etc. An Article for Limitation of Benefits to
    the residents of the contracting countries has also been included to prevent misuse of the DTAA.

    4. Other features of the revised Agreement are:-
    a) Provisions regarding Service PE has been included in the Article concerning PE.
    b) Paragraph 2 to Article 9 has been included to increase the scope for relieving double
    taxation through recourse to Mutual Agreement Procedure (MAP).
    c) A new Article on assistance in collection of taxes has been added to ensure assistance in
    collection of taxes when such taxes are due under the domestic laws and regulation.
    d) The time test for Independent Personal Service has been extended from 90 days or more
    in the relevant fiscal year to 183 days or more in any period of 12 months commencing
    or ending in the fiscal year concerned.

    5. The revised DTAA will enter into force after completion of internal processes in both the
    countries.

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