25 Sep 2016

India and Samoa: Tax Information Exchange Agreement - Important GK Updates for IBPS PO 2016

India and Samoa: Tax Information Exchange Agreement - Important GK Updates for IBPS PO 2016
India and Samoa: Tax Information Exchange Agreement - Important GK Updates for IBPS PO 2016:
Dear Readers, The Union Cabinet on 21 September 2016 gave its approval for signing and ratification of agreement between India and Samoa for the exchange of information with respect to Taxes.


·        This agreement will stimulate the flow of exchange of information between the two nations for tax purposes which will help curb tax evasion and tax avoidance.
·        As of now, there are no financial implications between the two nations.
·        Only in the event of extraordinary costs exceeding 500 US dollars, the same will be borne by India.
·        India has similar provisions in other such tax information exchange agreement.
Salient features of the Agreement:
·        It enables the competent authorities of the two nations to provide assistance through exchange of information that is relevant to the administration and enforcement of the domestic laws of the two countries concerning taxes covered by this Agreement.
·        The information received under the Agreement shall be treated as confidential and may be disclosed only to persons or authorities (including courts or administrative bodies) concerned with assessment, collection, enforcement, prosecution or determination of appeals in relation to taxes covered under the Agreement.
·        Information may be disclosed to any other person or entity or authority or jurisdiction with the prior written consent of the information sending country.
·        The Agreement also provides for Mutual Agreement Procedure for resolving any difference or for agreeing on procedures under the Agreement.
·        The Agreement shall enter into force on the date of notification of completion of the procedures required by the respective laws of the two countries for entry into force of the Agreement.
·        Negotiations for entering into an Agreement for the exchange of information with respect to Taxes were finalized between India and Samoa in June 2016 and both countries have agreed on the text of the Agreement.
·        Section 90 of the Income Tax Act, 1961 allows the Union Government to enter into an agreement with a foreign country or specified territory for exchange of information for the prevention of evasion or avoidance of income-tax chargeable under the Income-tax Act, 1961. 

 

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