India Mutual Agreement Procedure Statistics

India Mutual Agreement Procedure (MAP) Statistics: An Overview

The mutual agreement procedure (MAP) is a process that helps resolve international tax disputes between countries. India, as a member of the Organisation for Economic Co-operation and Development (OECD), is committed to the MAP framework and has been actively engaged in resolving tax disputes with its treaty partners.

In this article, we will examine the current state of India`s MAP statistics, highlighting its progress and challenges in resolving tax disputes.

MAP Process in India

The MAP process in India is governed by the tax treaties that India has signed with its treaty partners. The process involves the respective competent authorities of the treaty partners, who work together to resolve disputes through mutual agreement.

The competent authority for India is the Central Board of Direct Taxes (CBDT) and for the foreign treaty partners, it is their respective tax authorities.

The MAP process can be initiated by the taxpayer or the tax authorities of the treaty partners. The process generally involves exchanging information between the competent authorities, negotiations, and arriving at a mutually agreed solution.

India`s MAP Statistics

According to the latest statistics released by the CBDT, India has resolved 131 cases under the MAP process, involving a total value of INR 9,971 crores (approximately US$1.34 billion) for the fiscal year 2019-20.

Out of the 131 cases, 90 were resolved with the US, accounting for 68% of the total value. Other countries with significant MAP cases included the UK, Japan, Germany, and France.

India`s MAP statistics show a significant increase in the number of cases resolved under the MAP process in recent years. In 2018-19, India resolved 67 cases involving a total value of INR 1,506 crores (approximately US$203 million).

The increase in the number of cases resolved can be attributed to India`s efforts to improve its tax administration and reduce disputes with its treaty partners.

Challenges and Future Outlook

Despite the progress made by India in resolving tax disputes through the MAP process, there are still significant challenges that need to be addressed.

One of the major challenges is the lack of a time-bound dispute resolution mechanism in tax treaties. Most tax treaties do not specify a time limit for resolving disputes, which can lead to delays and uncertainty for taxpayers.

Another challenge is the lack of resources and expertise in the tax administration to effectively engage in the MAP process.

Going forward, India needs to address these challenges and continue to improve its tax administration to ensure a smooth and effective MAP process. This will help in promoting investment and economic growth by providing certainty and predictability to taxpayers.

Conclusion

India`s MAP statistics show a significant increase in the number of cases resolved under the MAP process, reflecting the country`s commitment to resolving tax disputes with its treaty partners. However, there are still challenges that need to be addressed to ensure a smooth and effective MAP process.

India needs to continue to improve its tax administration and work with its treaty partners to establish a time-bound dispute resolution mechanism in tax treaties. These efforts will help in promoting investment and economic growth by providing certainty and predictability to taxpayers.