India Efforts On to Address Concern in Tax Treaty with Mauritius

Government has proposed to review the India-Mauritius Double Taxation Avoidance Convention (DTAC) to incorporate amendments to the pact for prevention of treaty abuse and to strengthen the mechanism for exchange of information on tax matters between the two countries.

In a written reply in Rajya Sabha, Minister of State for Finance J D Seelam said a joint working group (JWG) comprising members from the two government was constituted in 2006 to review the DTAC. The JWG has met a number of times.

"However, agreement on revision of treaty could not be reached so far. Consistent efforts are being made by the Indian government to find mutually acceptable solution for addressing India's concern," Seelam said.

The DTAC is being revised amid concerns that the Indian Ocean nation was being used for round--tripping of funds to and from India, although Mauritius has always maintained that there have been no concrete evidence of any such misuse.

Mauritius is one of the biggest source of foreign direct investment into India.