The Union Cabinet on Wednesday approved the Double Taxation Avoidance Agreement (DTAA) between India and Chile. The tax agreement helps tax-payers in these countries avoid being taxed twice for the same income. A DTAA applies in cases where a tax-payer resides in one country and earns income in another.
"Clear allocation of taxing rights between contracting states through the agreement will provide tax certainty to investors and businesses of both countries while augmenting the flow of investment through fixing of tax rates in source state on interest, royalties and fees for technical services," the government said in a statement.
The agreement will implement minimum standards and other recommendations of G-20 OECD Base Erosion Profit Shifting (BEPS) Project.
The Cabinet also approved a loan waiver of ₹4.24 lakh crore plus interest from April 1, 2019, outstanding against Sikkim Mining Corporation. "Further accumulation of interest on the principal loan will get extinguished and the liquidation process of the Corporation will get completed," the statement said.