India Signs Multilateral Tax Cooperation Convention

by Mary Swire, Tax-News.com, Hong Kong

Monday, January 30, 2012

India is the latest signatory to join the multilateral Convention on Mutual Administrative Assistance in Tax Matters, an agreement drafted to promote international tax cooperation.

Welcoming the signing, the Organization for Economic Cooperation and Development (OECD) said the addition of India to the agreement would encourage more countries to join, "sending a strong signal that countries are acting together to ensure that individuals and multinational enterprises pay the right amount of tax, at the right time and in the right place”.

The pact, drafted by the OECD, provides for administrative cooperation between parties in the assessment and collection of taxes, with the stated aim of combating tax avoidance and evasion.

“With taxpayers increasingly operating on a global basis, tax authorities are moving from bilateral to multilateral cooperation and from exchange of information on request to other forms of co-operation. The Convention is an effective and practical tool to help tax authorities in their everyday work,” the OECD said.

Welcoming India's signature, Jeffrey Owens, Director of the OECD Centre for Tax Policy and Administration, said: “India has moved very quickly since its commitment to the Convention at the November G20 ceremony in Cannes and I expect it will be the first non-OECD G20 country for which the updated Convention is in force”.

Signatories to the amended Convention are: Argentina, Australia, Belgium, Brazil, Canada, Denmark, Finland, France, Georgia, Germany, Iceland, India, Indonesia, Ireland, Italy, Japan, Korea, Mexico, Moldova, Netherlands, Norway, Poland, Portugal, Russia, Slovenia, South Africa, Spain, Sweden, Turkey, Ukraine, the United Kingdom, and the United States.