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Mauritius for balanced view on resolving taxation treaty issues
August, 31st 2006
Mauritius would continue to collaborate with India to ensure that any alleged misuse of the double taxation avoidance agreement (DTAA) between the two countries is dealt with promptly and the interests of both parties to the treaty are protected, the visiting Deputy Prime Minister and Finance Minister of Mauritius, Mr Rama Sithanen, has said. "We will collaborate and cooperate to put an end to what is being perceived as some issues. "There are many bonafide investors who are using this treaty and we have to continue to make sure that these people use the treaty," Mr Sithanen told reporters on Tuesday. Balanced view While promising to collaborate with the Indian government to address the issues that are cropping up, he also underscored the need to ensure that no economic prejudice is caused on Mauritius by not having a level playing field. In particular, he highlighted the joint parliamentary committee (JPC) report on stock market scam that recommended that Mauritius should not be singled out for action in view of the strong political relations between the two countries. The JPC had pointed out that there were atleast 17 DTAAs that India had entered into with other countries where the capital gains tax provision was available. Mr Sithanen felt that the level playing field that Mauritius had with respect to these countries should not be diminished. "We need to have a balanced view of the advantages and the benefits of DTAA between the two countries and should not find ourselves to a situation where Mauritius is picked as single one for action", he said. Strengthening ties He said that the main purpose of his three-day visit to India was to find ways and means to strengthen collaboration, strengthen the mechanism of exchange of information so that the problems that are being raised could be addressed. Stating that many of the issues raised on the treaty have been addressed by Mauritius since 1994, Mr Sithanen highlighted the responses that the Mauritius government had already taken to sort out the issues raised. "We have amended our law to allow exchange of information. We have also completely eliminated round tripping. As regards to tax residency certificates, these certificates are now given on a yearly basis as opposed to giving it on indefinite basis. This would give us a chance to review it in case of any queries", he said.
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