Mutual Agreement Procedure India Statistics

Mutual Agreement Procedure (MAP) is a dispute resolution mechanism that allows for resolving tax-related disputes between two countries. This mechanism is particularly beneficial for taxpayers who have cross-border transactions and face double taxation due to conflicting tax laws of two countries.

India is a signatory to the relevant Double Taxation Avoidance Agreements (DTAAs) with various countries, including the United States, the United Kingdom, France, and Germany. Under the MAP, taxpayers can avail themselves of the benefit of the agreement and resolve their tax disputes.

According to recent statistics, the Mutual Agreement Procedure has gained significant traction in India. The number of MAP cases filed between India and various countries has increased in the past few years. Out of the total 1,009 MAP cases filed by India till 2020, the United States accounts for the highest number, with 278 cases. The United Kingdom and Japan follow with 205 and 67 cases, respectively.

MAP is a beneficial mechanism for taxpayers as it provides them with an opportunity to resolve their tax disputes without resorting to litigation. The process involves negotiation between the competent authorities of the two countries, and the decision arrived at is mutually agreed upon. This mechanism ensures that taxpayers are not subjected to double taxation and helps in avoiding unnecessary litigation costs.

The Indian Government has been actively promoting the MAP mechanism in recent times. In 2019, the Central Board of Direct Taxes (CBDT) issued a notification that sought to expedite the resolution of MAP cases. The notification stated that no new MAP cases should be filed after three years from the end of the financial year in which the taxes are charged.

The notification also directed that cases pending for more than 24 months should be subjected to periodic review and monitored by the concerned authorities. This move by the CBDT has been seen as a significant step towards streamlining the MAP process and ensuring that taxpayers get a speedy resolution to their disputes.

In conclusion, the Mutual Agreement Procedure is an essential mechanism for resolving tax disputes between two countries. The increasing number of MAP cases filed by India demonstrates the significance of this mechanism. With the active promotion of MAP by the Indian Government, the process is likely to become more streamlined, ensuring that taxpayers get a speedy resolution to their disputes.