ASEAN KEY DESTINATIONS
April 7, 2008
India and Myanmar have signed the Double Taxation Avoidance Agreement, which will enable both nations to prevent tax evasion and ensure that business profits are taxed only in the country where the company has a permanent establishment, Indian business daily Economic Times reported.
The agreement, which aims at avoidance of double taxation and the prevention of fiscal evasion with respect to income on taxes, was signed Friday by Central Board of Direct Taxes' Chairman P K Misra and Myanmar's Ambassador Kyi Thein.
The tax agreement would cover income-tax and surcharge in the case of India and income tax and profit tax in the case of Myanmar, an Indian Finance Ministry statement said.
There is a provision in the agreement that profits of a construction, assembly or installation projects would be taxed in the state of source if the project continues in that state for 270 days or more.
Under the agreement, business profits would be taxable in the source state if the activities of an enterprise constitute a permanent establishment in the source state, it added.
Trade between India and Myanmar has been steadily increasing to nearly $1 billion. Myanmar plays a key role in the country's energy security road map as it has several oil and gas fields, being eyed by both India and China.
Last September, amidst pro-democracy protests, Union Petroleum Minister Murli Deora visited the country and signed agreements with the junta.
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