India, Albania sign taxation pact

India and Albania today signed the double taxation avoidance agreement (DTAA) to facilitate the exchange of banking information and help check tax evasion.

"The Government of India signed here today an Agreement for Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on Income and on Capital (DTAA) with Government of Albania," the Finance Ministry said in a statement.

The pact incorporates provisions for effective exchange of information between tax authorities of the two counties in line with latest international standards, including exchange of banking information and supply of information without recourse to domestic interest, it added.

Besides, it said, business profits will be taxable in the source state if the activities of an enterprise constitute a Permanent Establishment (PE) there.

The agreement provides for fixed place PE, building site, construction and installation PE, service PE and agency PE.

It also contains an Article on Assistance in Collection of Taxes. This article also includes provision for taking measure of conservancy, the statement said.

Moreover, it incorporates anti-abuse (limitation of benefits) provisions to ensure that the benefits of the agreement are availed of by the genuine residents of the two countries, it added.

The agreement was signed by Central Board of Direct Taxes (CBDT) Chairperson Sudha Sharma, Albanian Ambassdor Fatos Kercifu.