The Union Cabinet chaired by the Prime Minister Narendra Modi has given its approval for signing of an Agreement between India and Maldives for the avoidance of double taxation of income from international air transport. The Agreement provides for relief from double taxation for airline enterprises of India and Maldives by way of exemption of income derived by the enterprise of India from the operation of aircraft in international traffic, from Maldivian tax and vice-versa.
Under the agreement, profits from the operation of aircraft in international traffic will be taxed in one country alone. Accordingly the taxing right is conferred upon the country to which the enterprise belongs. The Agreement will provide tax certainty for airline enterprises of India and Maldives.
The Agreement further provides for Mutual Agreement Procedure for resolving any difficulties or doubts arising as to the interpretation or application of the Agreement.
Did You Know???
- The island nation of Maldives is south of India in the Indian Ocean.
- Visitors and fishing sustain the economy, and the tourism industry has successfully rebounded after being badly hit by the December 2006 Indian Ocean tsunami.
- Not only is Maldives the smallest country in Asia, it is also the smallest Muslim country in the world.
- The Maldives boasts a 98-percent literacy rate among adults; this is a huge jump from 70 percent in 1978.
- Because of the country’s strict Islamic beliefs, tourists are expected to obey and respect Muslim traditions while on the islands.