Amendment to Double Taxation Avoidance Protocol between Indian and Oman

Notification for protocol amending the Agreement between the Republic of India and Sultanate of Oman for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income. 

India and Oman has made amendments to protocol for the avoidance of double taxation and the prevention of fiscal evasion of taxes on income.

The provisions of the Protocol have effect: in India in respect of income derived in any fiscal year beginning on or after the first day of April following the date on which the Protocol enters into force and in the Sultanate of Oman in respect of income derived in any tax year following the date on which the Protocol enters into force.

Article 10 related to “Associated Enterprises” has been amended to provide that where a Contracting State includes in the profits of an enterprise of that State – and taxes accordingly – profits on which an enterprise of the other Contracting State has been charged to tax in that other State and the profits so included are profits which would have accrued to the enterprise of the first-mentioned State if the conditions made between the two enterprises had been those which would have been made between independent enterprises, then that other State shall make an appropriate adjustment to the amount of the tax charged therein on those profits. In determining such adjustment, due regard shall be had to the other provisions of this Agreement and the competent authorities of the Contracting States shall, if necessary, consult each other.

Article 4 namely “Resident” has been amended. When a person other than an individual is a resident of both Contracting States, the competent authorities of the Contracting States shall endeavour to determine by mutual agreement the Contracting State of which such person shall be deemed to be a resident for the purposes of this Agreement.

Article 13 and 14 have been amended to provide that for royalties and technical fee, if the recipient is the beneficial owner of the royalty/technical fee, tax charged shall not exceed 10% in other contracting State.

A new Article 25A namely “Non-Discrimination” has been added. It provides that nationals of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith, which is other or more burdensome than the taxation and connected requirements to which nationals of that other State in the same circumstances, in particular with respect to residence, are or may be subjected.

Article 27 related to “Exchange of Information has been substituted by a new comprehensive Article. It is provided that if the information is requested by a Contracting State in accordance with this Article, the other Contracting State shall use its information gathering measures to obtain the requested information, even though that other State may not need such information for its own tax purposes. The Contracting State can not decline to supply information solely because it has no domestic interest in such information or for the reason that the information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in person.

A new Article 27A has been added namely “Assistance in the Collection of Taxes”. It provides that the Contracting States shall lend assistance to each other in the collection of revenue claims.

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