14 May 2016

EPW: Mauritius No Longer India's Treasure Island

Was the decision to amend the treaty with Mauritius an answer to the growing criticism within the country and outside to plug loopholes that blatantly facilitated conversion of black money into white by moving funds quickly through different no-tax jurisdictions, a phenomenon sometimes described as “treaty shopping”? Senior officials in the Ministry of Finance have acknowledged that the old treaty with Mauritius had become untenable in view of the government’s intention to implement a general anti-avoidance rule or GAAR aimed at curbing tax avoidance with effect from April 2017.

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