New Delhi, Feb 4 (PTI) Taking forward its efforts totrack and unearth blackmoney, India has now ratified itsDouble Taxation Avoidance Agreements with SAARC nations andthe revised treaties will come into effect from next fiscal.
The tax agreement, amongst SAARC countries--Bangladesh,Bhutan, Maldives, Nepal, Pakistan, Sri Lanka and India--wasratified by the SAARC Secretariat last April.
"The central government hereby directs that all theprovisions of the said agreement shall be given effect to inthe Union of India with effect from 1st day of April, 2011,"the official government Gazette notification said.According to the notification, the new agreement willapply to persons who are residents of one or more memberstates.
The tax information exchange treaties amongst the SouthAsian Association For Regional Cooperation (SAARC) nations wasstruck first at Dhaka in 2005.
Members of SAARC bloc include Bangladesh, Maldives,Bhutan, Nepal, India, Afghanistan, Pakistan and Sri Lanka.
"On formalisation, this SAARC limited multilateralagreement on avoidance of double taxation and mutualadministrative assistance in tax matters shall be applicableonly in the member states where an adequate Direct Taxstructure is in place.
"Further, in case of a member state where such astructure is not in place, this agreement shall becomeeffective from the date on which such a member stateintroduces a proper Direct Tax structure and notifies theSAARC secretariat to this effect," the Gazette notificationadded.
At present, India is in the process of negotiating DoubleTaxation Avoidance Agreements (DTAAs) with 65 countries.
This is to broaden the scope of article concerningExchange of Information, specifically regarding banking andtaxpayers not covered by the said exchange treaty.
Finance Minister Pranab Mukherjee had recently spelledout new initiatives by the government to check and curbblackmoney in the country.
He said DTAA and Exchange of Taxation InformationAgreement are two instrumentalities under which informationcan be obtained and that the government has already amendedpacts with 23 countries to get information from various banks.