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India and China sign protocol to Double Taxation Avoidance Agreement to prevent tax evasion

India and China have signed protocol to amend Double Taxation Avoidance Agreement (DTAA) for the avoidance of double taxation and for prevention of fiscal evasion with respect to taxes on income by allowing exchange of information. Under Section 90 of Income-tax Act, 1961, India can enter into agreement with foreign country or specified territory for the avoidance of double taxation of income, for exchange of information for the prevention of evasion.

Key Facts

The Protocol to amend DTAA with China updates existing provisions for exchange of information to latest international standards. It incorporates changes required to implement treaty related minimum standards under the Action reports of Base Erosion & Profit Shifting (BEPS) Project. Besides minimum standards, it also brings in changes as per BEPS Action reports as agreed upon by the two sides. It will help prevent tax evasion by allowing the exchange of information.

Month: Categories: India Current Affairs 2018

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Japan cabinet approves economic stimulus package worth $275 billion

Japan’s cabinet has approved an economic stimulus package worth 275 billion dollars in attempt kick-start the economy and boost growth of the world’s third-largest economy.

Decision in this regard was Japanese Cabinet meeting chaired by Prime Minister Shinzo Abe in Tokyo. The Japanese government expects that this package will boost gross domestic product (GDP) by 1.3%.

Key Facts

  • The economic stimulus package of measures aims at tackling deflation and strengthening the national economy of Japan.
  • It includes increase expenditure for the national and local governments as well as significant investments in the country’s infrastructure.
  • It also includes in a supplementary budget, which will be considered by an extraordinary session of Parliament starting in September.
  • It also will provide support of small and medium-sized enterprises in Japan over the next two years. More than half of package sum has been earmarked for the current fiscal year.
  • The package also includes spending on reconstruction of disaster zones, including parts of north-eastern Japan which were devastated by 2011 earthquake and tsunami.

Background

  • Japan’s economy, which is the third largest economy (in terms of nominal GDP) in the world after US and China, has been affected by stagnation and slow economic growth.
  • In order to revive the economy Japanese government under the Prime Minister Sinzo Abe already had announced series of measures to halt economic stagnation.
  • In 2012, Japanese government had announced series measures such as structural reforms, monetary easing and fiscal stimulus as part of the plan dubbed as Abenomics.

Month: Categories: Business & Economy Current Affairs 2018International Current Affairs 2018

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