India, Spain sign protocol to amend DTAA
New Delhi: India and Spain Friday signed a protocol for amending the over 19-year old double taxation avoidance pact, a move aimed to stimulate effective exchange of information between the two countries.
"Protocol for amending the Convention and Protocol between India and Spain for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital" were among the documents signed during the state visit of King of Spain Juan Carlos I.
The document was signed by Finance Minister P Chidambaram and Spanish Foreign Affairs and Cooperation Minister Jose Manuel Garcia-Margallo y Marfil.
"It is expected to stimulate the effective exchange of information and enable assistance in collection of taxes between India and Spain. It will reduce obstacles in mutual cooperation between the two countries and also prevent the abuse of the benefits of the Convention," the Finance Ministry said in a statement.
The Protocol will enter into force on completion of internal procedures in both the countries.
The two countries had signed the agreement for avoidance of double taxation and prevention of fiscal evasion on February 8, 1993 in New Delhi.
Amid blackmoney becoming a major issue of concern, India has started negotiating its tax avoidance pacts, popularly known as DTAAs (Double Taxation Avoidance Agreements) with over 75 countries, to get banking related information in line with international norms.
The move is aimed at strengthening the exchange of information relating to tax evasion, money laundering and other criminal activities.