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Double Taxation Agreement Mauritius India

Double Taxation Agreement Mauritius India

Send your article via our online form Click here Note we only accept original articles, we do not accept articles that have already been published on other websites. For more details Contact: editor@legalserviceindia.com It`s a bit enigmatic, because in 2016, India also renegotiated its double tax evasion agreement with Singapore in order to close exactly the same loopholes that existed with Mauritius, which relied on the imposition of capital gains on the sale of shares. Perhaps Singapore`s strengths other than the financial hub, such as the ability of companies to raise funds at comparatively low interest rates, and that an effective dispute resolution system continues to be a preferred place for Indians to start businesses. In the current situation where there is economic instability in the market, this is a major setback for investors, where each country is trying to create a friendly market for investment and where judgments like AAR will remove investors from the country. First, the effects of such an order are expected to be colossal. Investors were protected under the grandfather`s general rule, i.e. investments before April 1, 2017, will not be taxable, but after changing the rules of the agreement between the Government of the Republic of India and the Government of Mauritius to avoid double taxation, exit plans have been strengthened2. The impact would also be visible in the process, as there is considerable uncertainty about the resignations of private equity firms and the DBAA signed by India with Mauritius. This is not the first time AAR has ruled against the normal course of the contract. On a few occasions, it has been found that investors and companies derive their money from Mauritius and Singapore, primarily to take advantage of DTAA`s advantage between India and Mauritius. After renegotiating its agreement on double tax evasion with Mauritius in 2016, India has seen some positive developments. First, a brief summary: the essence of the 2016 renegotiation was to close the central loophole that made Mauritius a preferred investment route to India. The loophole was the residence-based tax on capital gains from the disposal of the shares.

Shorn of jargon, which means that if a Mauritius-based company invests in shares in a company based in India and then sold those shares and made a profit, they would have to pay capital gains tax in Mauritius. In practice, Mauritius does not collect capital gains tax! This loophole was closed in 2016 and from now on there would be a source-based tax on capital gains. This means that if Mauritius-based companies sold shares in an India-based company, India would collect capital gains tax. Naomi Fowler – India and the renegotiation of its double taxation agreement with Mauritius: an update This raises another question: Where did they scrape these funds? Some of them may have gone to Singapore.


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