By TIOL News Service

NEW DELHI, OCT 07, 2015: THE Union Cabinet today approved the proposals of Protocols to amend the DTAAs between India-Israel and India-Vietnam.

The Protocol amending the India-Isreal DTAA provides for internationally accepted standards for effective exchange of information on tax matters including bank information and information without domestic tax interest. It is further provided that the information received from Israel in respect of a resident of India can be shared with other law enforcement agencies with authorisation of the Competent Authority of Israel and vice versa.

The Protocol further provides for 'Limitation of Benefits' Article as an anti-abuse provision aimed at preventing misuse of the Convention. The provisions of this Article enable use of the provisions of domestic law and measures concerning tax avoidance or evasion in the event of misuse of the Convention.

The existing Double Taxation Avoidance Convention (DTAC) between Indian and Israel was signed in 1996. Both the Indian and Israeli sides agreed to update Article 27 on the ‘Exchange of Information’ in India-Israel DTAC to meet internationally accepted standards.

Similarly, the protocol amending the India-Vietnam DTAA provides for internationally accepted standards for effective exchange of information on tax matters including bank information and information without domestic tax interest. It is further provided that the information received from Vietnam in respect of a resident of India can be shared with other law enforcement agencies with authorisation of the Competent Authority of Vietnam and vice versa.

The existing Double Taxation Avoidance Agreement (DTAA) between Indian and Vietnam was signed in 1994. Both the Indian and Vietnamese sides agreed to update Article 27 on the ‘Exchange of Information’ in India-Vietnam DTAA, to meet internationally accepted standards, and add a new Article on ‘Assistance in the Collection of taxes’, and enter into an Amending Protocol for the purpose.