FM assures India Inc on TRC issue

Published: 02nd March 2013 10:09 AM  |   Last Updated: 02nd March 2013 10:09 AM   |  A+A-

In a bid to quell India Inc’s concerns for claiming benefits under the Double Taxation Avoidance Agreement (DTAA), the Finance Ministry on Friday clarified on the issue of Tax Residency Certificate (TRC) and assured investors that their concerns would be “suitably” addressed when the Finance Bill is taken up for consideration by Parliament.

“Since a concern has been expressed about the language of sub-section (5) of Section 90 (of I-T Act), this concern will be addressed suitably when the Finance Bill is taken up for consideration,” the Finance Ministry said in a statement.

 Confusion cropped up when the government said on Thursday that a TRC “shall be necessary but not a sufficient condition” to take advantage of DTAA.

The Finance Ministry further clarified that TRC held by foreign investors would be accepted.

The government also added that the treaty with Mauritius remained, pending ongoing discussions between both nations.

Investors were concerned about availing benefits under DTAA while routing funds from low-tax countries such as Cyprus, Singapore and Mauritius.

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