ISLAMABAD: Federal Board of Revenue (FBR) initiated negotiations on the Convention for the Elimination of Double Taxation with respect to Taxes on Income and on Capital and the Prevention of Tax Evasion and Avoidance with Iraq on Thursday.

In this connection, tax delegations of both the countries met at Islamabad for the first round of negotiations from 7-9 August, 2023. After detailed deliberations, a consensus was achieved and draft of the Convention was initiated by the respective heads of delegation on 9th August, 2023 at Islamabad.

The Convention will not only provide safeguards against double taxation on the income of the residents of both the countries but will also promote economic cooperation and enhance investments.

It will further strengthen the existing bilateral economic relations between the two Contracting States. It will provide adequate certainty in respect of taxation rules applicable to cross-border business transactions, dividends, interests, royalties and fee for technical services and income from automated digital services etc.

Taxpayers of both countries will get relief from double taxation resulting in further boosting up the trading activities in both the countries.

Copyright Business Recorder, 2023