ISLAMABAD-Federal Board of Income initiated renegotiations on the Settlement for the Elimination of Double Taxation with respect to Taxes on Earnings and the Prevention of Tax Evasion and Avoidance between Pakistan and Germany. On this connection, tax delegations of each the international locations met at Islamabad for the primary spherical of negotiations from 18-22 September, 2023. The primary draft of the Settlement was initialed by the respective heads of delegation on 22nd September, 2023 at Islamabad after detailed consultations and mutual settlement on key articles of the draft Settlement.
It’s pertinent to say that the present Settlement for the Avoidance of Double Taxation between Pakistan and Germany in observe was signed in 1994 and requires revision to cater to altering tax guidelines and rules as per worldwide and home wants. The revised Settlement as soon as finalized won’t solely strengthen the present safeguards towards double taxation on the revenue of the residents of each the international locations with out creating alternatives for non-taxation or diminished taxation by way of abusive preparations. It would additionally promote financial cooperation, strengthen the present bilateral financial relations and improve investments in each international locations whereas making certain satisfactory certainty in respect of taxation guidelines relevant to cross-border enterprise transactions. Taxpayers of each international locations will get aid from double taxation leading to boosting up the buying and selling actions in each the international locations.
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