Big progress on tax treaty with India: Mauritius
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Last Updated: Friday, July 06, 2012, 11:15
  
New Delhi: Mauritius on Friday said it has exchanged information related to over 170 cases with India over three years, and the two countries have made big progress on the double taxation avoidance treaty since 2006.

Some of the information exchanged was even outside the Double Taxation Avoidance Agreement (DTAA) the two countries have with each other, Mauritius Foreign Minister Arvin Boolell told reporters here.

He added, however, that domestic legislations should not over-ride the treaty between the two countries.

"Domestic legislations should not over-ride the taxation treaty between India and Mauritius," Boolell said.

India-Mauritius tax treaty provides that capital gains arising in India from investments in the country from the island nation can only be taxed in Mauritius.

As Mauritius does not tax capital gains, investments that are routed through the country escape this levy.

A large quantum of foreign investments in India are routed through Mauritius to escape the tax net, which has prompted the government to bring out the General Anti- Avoidance Rules (GAAR) to prevent abuse of the tax treaty.

"Mauritius has done everything to curb round-tripping," Boolell said.

During talks with External Affairs Minister SM Krishna yesterday, Boolell had also underlined the importance of Mauritius as a springboard for investments by Indian entrepreneurs to Africa.

Amid concerns about Mauritius being used as a route for evasion of taxes, India yesterday got an assurance from the country that it would have a re-look over various aspects related to tax treaties, like DTAA.

"If there is room for improvement, we will constantly make room for improvement, of course, in respect and in compliance with the best international practices," Boolell had said, when asked by the media about India's demands for reworking DTAA.

PTI


First Published: Friday, July 06, 2012, 11:15


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