Double Taxation Avoidance Agreements and its Development

Abstract

Double Taxation is the additional load of at least two taxes on a similar kind of income, resource, financial exchanges etc. It alludes to taxation by at least two countries of a similar income, resource or exchange, for instance income paid by an element of one country to an inhabitant of an alternate country. The double obligation is frequently alleviated by tax deals between countries. Double Taxation Avoidance Agreements are deals between two sovereign states. Double Taxation Avoidance Agreements are obviously a communication of two tax frameworks each having a place with an alternate country, which expect to relieve the impact of double taxation. Double taxation is as yet one of the snags to the improvement of between country financial relations. Each country looks to tax the income produced inside its region based on at least one interfacing factors. Through Double Taxation Avoidance Agreements, every country obliges the cases of other countries inside their monetary field to foster international exchange and speculations with insignificant obstructions. Notwithstanding, the international tax regime must be rebuilt continually in order to answer the current difficulties and disadvantages. It is likewise vital for India to exploit the current worldwide move to more noteworthy straightforwardness and receptiveness by fortifying data sharing and managerial help arrangements in its DTAAs. The eventual acceptance of DTAA’s has only made tax collection more equitable and fair and as the relationships within the countries grow, it will only lead to better taxation arrangements. The paper discusses the Vodafone case in detail and aligns it with the said topic.

Keywords: Double taxation, agreements, tax slab, avoidance

JEL Classification: K34