The Union Cabinet on Wednesday approved a protocol amending the agreement between India and Vietnam for the avoidance of double taxation and for prevention of fiscal evasion with respect to taxes on income.
The protocol provides for internationally accepted standards for effective exchange of information on tax matters including bank information and information without domestic tax interest.
It is further provided that the information received from Vietnam in respect of a resident of India can be shared with other law enforcement agencies with authorisation of the Competent Authority of Vietnam and vice versa.
The existing Double Taxation Avoidance Agreement (DTAA) between Indian and Vietnam was signed in 1994.
Both the Indian and Vietnamese sides agreed to update Article 27 on the ‘Exchange of Information’ in India-Vietnam DTAA, to meet internationally accepted standards, and add a new Article on ‘Assistance in the Collection of taxes’, and enter into an amending protocol for the purpose.