Dissecting Principal Purpose Test : An Indian Perspective and its’ Impact on Select Treaties
- Year of Publication: 2020
- ISBN: 0
Course Duration:
240 minutes (two episodes of 120 minutes each)
Module Background:
Article 7 of the MLI in line with OECD BEPS Action Plan 6 gives options to countries to opt for any of the three anti-abuse measures to meet the minimum standard requirement to tackle treaty abuse, (1) a principal purpose test (“PPT”), which denies treaty benefits if one of the principal purposes of the transaction was to obtain treaty benefit, (2) PPT supplemented with either Simplified Limitation of Benefits (SLOB) or detailed LOB clause, or, (3) detailed LOB provision, supplemented by a mutually negotiated mechanism to deal with conduit arrangements not already dealt with in a Covered Tax Agreement [CTA]. Since this is a minimum standard, India has opted for PPT as an interim measure to prevent treaty abuse along with the possibility to adopt LOB provisions through bilateral negotiation, giving India the option to amend its existing treaties to incorporate LOB provisions where deemed necessary, in addition to or as a replacement of PPT.
What shall the modules cover?
Against this backdrop, Taxsutra in conjunction with Tax Advocate Mr. Mukesh Butani (Founder, BMR Legal) has unveiled a module on “Dissecting Principal Purpose Test: An Indian Perspective and its’ Impact on Select Treaties”. Over the course of this distinctive module, the speaker has comprehensively covered a plethora of nuances associated with Article 7 of the MLI, which includes the following:
- Background and Design of Article 7
- Wording structure, mechanics & effect of Article 7(1) & 7(2)
- Subjective and Objective elements of PPT
- Discretionary relief under Article 7(4) of the MLI
- SLOB Test and analysis of its requirements, including symmetrical & asymmetrical treaty clause
- Interpretative tools to Article 7
- Analysing the impact of Article 7 on Key Treaties with specific case studies
- Interplay of Anti-Abuse Measures present in the Treaty with PPT
- Interplay of PPT with GAAR with case studies
- Implementation Challenges for PPT
Mukesh Butani is Founder & Managing Partner of BMR Legal Advocates. With specialisation in domestic corporate international tax and transfer pricing, he has over three decades of experience in advising multinationals and Indian conglomerates on a wide range of matters relating to FDI policy, business re-organisations, cross-border tax structuring, tax controversy and regulatory policy. He is an acknowledged expert in the area of International Tax policy, controversy & advocacy, and has to his credit several landmark judicial pronouncements.
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: 2020
- ISBN: 0
Course Duration:
240 minutes (two episodes of 120 minutes each)
Module Background:
Article 7 of the MLI in line with OECD BEPS Action Plan 6 gives options to countries to opt for any of the three anti-abuse measures to meet the minimum standard requirement to tackle treaty abuse, (1) a principal purpose test (“PPT”), which denies treaty benefits if one of the principal purposes of the transaction was to obtain treaty benefit, (2) PPT supplemented with either Simplified Limitation of Benefits (SLOB) or detailed LOB clause, or, (3) detailed LOB provision, supplemented by a mutually negotiated mechanism to deal with conduit arrangements not already dealt with in a Covered Tax Agreement [CTA]. Since this is a minimum standard, India has opted for PPT as an interim measure to prevent treaty abuse along with the possibility to adopt LOB provisions through bilateral negotiation, giving India the option to amend its existing treaties to incorporate LOB provisions where deemed necessary, in addition to or as a replacement of PPT.
What shall the modules cover?
Against this backdrop, Taxsutra in conjunction with Tax Advocate Mr. Mukesh Butani (Founder, BMR Legal) has unveiled a module on “Dissecting Principal Purpose Test: An Indian Perspective and its’ Impact on Select Treaties”. Over the course of this distinctive module, the speaker has comprehensively covered a plethora of nuances associated with Article 7 of the MLI, which includes the following:
- Background and Design of Article 7
- Wording structure, mechanics & effect of Article 7(1) & 7(2)
- Subjective and Objective elements of PPT
- Discretionary relief under Article 7(4) of the MLI
- SLOB Test and analysis of its requirements, including symmetrical & asymmetrical treaty clause
- Interpretative tools to Article 7
- Analysing the impact of Article 7 on Key Treaties with specific case studies
- Interplay of Anti-Abuse Measures present in the Treaty with PPT
- Interplay of PPT with GAAR with case studies
- Implementation Challenges for PPT
Mukesh Butani is Founder & Managing Partner of BMR Legal Advocates. With specialisation in domestic corporate international tax and transfer pricing, he has over three decades of experience in advising multinationals and Indian conglomerates on a wide range of matters relating to FDI policy, business re-organisations, cross-border tax structuring, tax controversy and regulatory policy. He is an acknowledged expert in the area of International Tax policy, controversy & advocacy, and has to his credit several landmark judicial pronouncements.
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)
