India has amended its existing double taxation avoidance convention (DTAC) with Kazakhstan for the avoidance of double taxation and prevention of fiscal evasion with respect to income taxes.
The original DTAC agreement between the two countries was first signed in 1996. The revised agreement incorporates internationally accepted norms for information sharing on tax matters.
“Further, the information received from Kazakhstan for tax purposes can be shared with other law enforcement agencies with authorisation of the competent authority of Kazakhstan and vice versa,“ the Indian ministry of finance said in a statement.
The revised treaty inserts a limitation of benefits clause for prevention of DTAC misuse and allows application of domestic law to combat tax evasion.
It also includes provisions to ease economic double taxation in transfer pricing cases.
The ministry said that the move aligns “with India’s commitment under Base Erosion and Profit Shifting (BEPS) Action Plan to meet the minimum standard of providing Mutual Agreement Procedure (MAP) access in transfer pricing cases.”
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In addition, the amended agreement also incorporates service PE (permanent establishment) provisions with a threshold and requires the profits attributed to PE to be determined based on apportionment of total profits of the enterprise.