India Mexico Double Taxation Avoidance AgreementJune 2, 2023 9:18 pm
India and Mexico Sign Double Taxation Avoidance Agreement
India and Mexico have signed a Double Taxation Avoidance Agreement (DTAA) aimed at preventing double taxation of income earned by residents of both countries. The agreement was signed on 17th June 2021 by India`s Ambassador to Mexico Manpreet Vohra and Mexico`s Undersecretary of Finance and Public Credit, Gabriel Yorio.
The DTAA is expected to provide relief to taxpayers in both countries who have been facing double taxation issues. It will also help in promoting bilateral trade and investment between the two countries by providing a stable and predictable tax regime.
Under the agreement, a resident of one country will be allowed to claim relief from double taxation in the other country by way of a tax credit or exemption. The agreement also provides for the exchange of information between the tax authorities of both countries to prevent tax evasion and avoidance.
The agreement covers income from various sources including business profits, dividends, interest, royalties, and capital gains. It also provides for the taxation of income from shipping and air transport and the taxation of income derived by residents of one country from offshore activities in the other country.
India and Mexico have been strengthening their economic ties in recent years. Mexico is one of India`s top trading partners in Latin America, and India is Mexico`s sixth-largest trading partner globally. The signing of the DTAA is expected to further enhance trade and investment between the two countries.
The signing of the DTAA is also in line with India`s broader policy of reducing tax disputes and promoting ease of doing business. The Indian government has been taking various measures to reduce litigation and provide a more stable and predictable tax regime for businesses.
The India-Mexico DTAA is the latest in a series of such agreements signed by India with other countries. India has already signed DTAA with over 90 countries including the United States, United Kingdom, China, and Japan, among others.
In conclusion, the India-Mexico Double Taxation Avoidance Agreement is expected to provide tax relief to residents of both countries and further enhance trade and investment between the two countries. The agreement is also in line with India`s broader policy of reducing tax disputes and promoting ease of doing business.
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