India inks protocol with U.K. to amend tax pact

In its continuing drive to check tax evasion and proliferation of black money, India has signed a protocol with the U.K. for amending the convention between the two countries for avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income and capital gains.

The protocol — signed in London on October 30 by India’s High Commissioner to the U.K., Jaimini Bhagwati, and U.K.’s Exchequer Secretary to the Treasury, David Gauke, on behalf of the two countries — amends the earlier Double Taxation Avoidance Convention (DTAC) that was inked here on January 25, 1993.

The protocol incorporates in the DTAC provisions for effective exchange of information between the tax authorities of India and the U.K. in line with the latest international standards, including exchange of banking information and supplying of information irrespective of domestic interest.

In the amended DTAC, there would now be a new article on assistance in collection of taxes. The article also includes provision for taking measures of conservancy. The protocol also incorporates into the convention anti-abuse (limitation of benefits) provisions. Further, both countries are to enter into MoUs to expedite exchange of information and assistance in collection of taxes.