CBDT’s Circular on MFN Clause – Decoding Tax & Legal Interpretations
- Year of Publication: 2022
- ISBN: 0
Episode Duration:
100 minutes
Episode Background:
To bring parity in the tax treatments for the OECD member nations, the concept of Most Favoured Nation (MFN) is prevalent under International tax laws. MFN is an international concept in a tax treaty that entitles the eligible tax residents to adopt the beneficial treatment (by way of a lower rate or restricted scope) accorded to a third country (OECD members). However, the matter of interpretation of the MFN clause has always been a matter of discussion not just domestically but across countries.
One such issue is with respect to India's position on the MFN clause present in certain Indian tax treaties. To this end, the Central Board of Direct Taxes (“CBDT”) issued Circular No 3/2022 dated 3 February 2022, which will have ripple effect of narrowing the scope or on reducing the tax rate for passive income streams (dividend, interest, royalty or technical fees) from certain other tax treaties.
What shall the episode cover?
To decode several nuances & provide clarity on interpretational issues arising from the aforesaid CBDT Circular, Taxsutra is delighted to present to you a special episode on “CBDT’s Circular on MFN Clause – Decoding Tax & Legal Interpretations” by Mr. Narendra Jain (Chartered Accountant, Company Secretary, Advocate & Founder of NNMS Legal Chambers).
Key Highlights:
In this episode, the speaker have deep dived into the following key aspects:
- Comprehensively analyze the impact of the Circular on taxation of interest, technical fee, royalty as well as dividend income
- (a)Throw light on the issue of deviation caused by the aforesaid Circular from the position approved by Delhi HC in case of Steria India [TS-416-HC-2016(DEL)]; (b) discuss the recent Pune ITAT Decision pertaining to the aforesaid circular [TS-79-ITAT-2022(PUN)
] (c) many other relevant judicial precedents - Evaluate the far reaching impact of the Circular much beyond the dividend tax issue for treaties with MFN clause.
- Brewing Controversies which may arise in the future
- Key Considerations for Taxpayers
Taxsutra is considered the most credible source of tax news in the tax fraternity. What started as a fledgling start-up has now become a leading brand in the tax world not only in India, but across the globe. Taxsutra's diverse customer set includes Fortune 500 Companies, large Indian Business Groups, Global Conglomerates, Tax Judges, IRS Officers, CBDT, Tax Lawyers & thousands of tax practitioners.
Taxsutra suite of portals :
1. Real time tax news & analysis for Corporate Tax (www.taxsutra.com/dt)
2. Transfer Pricing Portal (www.taxsutra.com/tp)
3. GST and Central Indirect Taxes Portals (www.taxsutra.com/gst - www.idt.taxsutra.com)
4. "Taxsutra Database" - Powerful Online Direct Tax Reference and Search Tool (www.database.taxsutra.com)
5. LawStreetIndia (LSI) (www.lawstreetindia.com) contains sub-modules on Company law, Securities law (SEBI/SAT), FEMA, IP laws & Competition Law
6. Taxsutra Accounting Standards portal (Ind-AS) (www.greentick.taxsutra.com)
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- Year of Publication: 2022
- ISBN: 0
Episode Duration:
100 minutes
Episode Background:
To bring parity in the tax treatments for the OECD member nations, the concept of Most Favoured Nation (MFN) is prevalent under International tax laws. MFN is an international concept in a tax treaty that entitles the eligible tax residents to adopt the beneficial treatment (by way of a lower rate or restricted scope) accorded to a third country (OECD members). However, the matter of interpretation of the MFN clause has always been a matter of discussion not just domestically but across countries.
One such issue is with respect to India's position on the MFN clause present in certain Indian tax treaties. To this end, the Central Board of Direct Taxes (“CBDT”) issued Circular No 3/2022 dated 3 February 2022, which will have ripple effect of narrowing the scope or on reducing the tax rate for passive income streams (dividend, interest, royalty or technical fees) from certain other tax treaties.
What shall the episode cover?
To decode several nuances & provide clarity on interpretational issues arising from the aforesaid CBDT Circular, Taxsutra is delighted to present to you a special episode on “CBDT’s Circular on MFN Clause – Decoding Tax & Legal Interpretations” by Mr. Narendra Jain (Chartered Accountant, Company Secretary, Advocate & Founder of NNMS Legal Chambers).
Key Highlights:
In this episode, the speaker have deep dived into the following key aspects:
- Comprehensively analyze the impact of the Circular on taxation of interest, technical fee, royalty as well as dividend income
- (a)Throw light on the issue of deviation caused by the aforesaid Circular from the position approved by Delhi HC in case of Steria India [TS-416-HC-2016(DEL)]; (b) discuss the recent Pune ITAT Decision pertaining to the aforesaid circular [TS-79-ITAT-2022(PUN)
] (c) many other relevant judicial precedents - Evaluate the far reaching impact of the Circular much beyond the dividend tax issue for treaties with MFN clause.
- Brewing Controversies which may arise in the future
- Key Considerations for Taxpayers
Taxsutra is considered the most credible source of tax news in the tax fraternity. What started as a fledgling start-up has now become a leading brand in the tax world not only in India, but across the globe. Taxsutra's diverse customer set includes Fortune 500 Companies, large Indian Business Groups, Global Conglomerates, Tax Judges, IRS Officers, CBDT, Tax Lawyers & thousands of tax practitioners.
Taxsutra suite of portals :
1. Real time tax news & analysis for Corporate Tax (www.taxsutra.com/dt)
2. Transfer Pricing Portal (www.taxsutra.com/tp)
3. GST and Central Indirect Taxes Portals (www.taxsutra.com/gst - www.idt.taxsutra.com)
4. "Taxsutra Database" - Powerful Online Direct Tax Reference and Search Tool (www.database.taxsutra.com)
5. LawStreetIndia (LSI) (www.lawstreetindia.com) contains sub-modules on Company law, Securities law (SEBI/SAT), FEMA, IP laws & Competition Law
6. Taxsutra Accounting Standards portal (Ind-AS) (www.greentick.taxsutra.com)
