Foreign tax jurisdictions: FBR enters into 66 double taxation agreements

ISLAMABAD: The Federal Board of Revenue (FBR) has entered into 66 double taxation agreements with foreign tax jurisdictions, but only 26 treaty partners have ratified measures relating to the prevent base erosion and profit shifting (MLI).

The letter of the FBR's International Taxes Wing to the field formations here on Tuesday, stated, "I am directed to refer to the subject and to state that Pakistan signed and ratified the MLI on 7 June 2017 and 18 December2020 respectively. All texts of Pakistan's Double Taxation Agreements (DTAs) with its partners, the MLI and Pakistan's position on MLI are available on FBR website under the tab of Directorate General of International Taxes at https:lldownloadl.fbr.gov.pklSROs/202142164212305MLIFATE.pdf. Furthermore, the MLI position of Pakistan and the MLI positions of its treaty partners are available on the OECD webpage http://www.oecd.org/tax/treatieslbeps-mli-signatories-and-parties.pdf. Pakistan's MLI matching database viz-a-viz its treaty partners is also available on https:llwww.oecd.org/taxltreaties/mli-matching-database.htm."

It added, "Pakistan had entered into 66 DTAs. Till now, out of 66, only 26 treaty partners of Pakistan have ratified MLI and have included Pakistan in their lists of Covered Tax Agreements (CTAs) as per Article 2 of the MLI. This Directorate has synthesized DTAs incorporating the relevant provisions of MLI which are being sent to treaty partners for input. After obtaining their input, the same will be uploaded on FBR's website."

"I am further directed to say that as on today, the dates of entry into force and entry into effect of MLI for Pakistan vis-à-vis its treaty partners (who have ratified the MLI and who have furnished dates of entry into force and entry into effect) are reflected..."

"I am further directed to convey that officers under your esteemed command may be directed to look at the original texts of Pakistan's all DTAs with its treaty partners, original text ofthe MLI, Pakistan's position on MLI and MLI position of its treaty partners, inter-alia, for applicability of substantive provisions of the MLI viz-a-viz its treaty partners, entry into force and entry into effect," the letter concluded.

Copyright Business Recorder, 2021