Nepal and India have signed on the Double Taxation Avoidance Agreement (DTAA) in order to cancel the double taxation and to prevent  fiscal evasion with respect to taxes on income.

Finance Minister Barshaman Pun and his Indian counterpart Pranab Mukharjee signed the agreement on the behalf of their receptive governments amidst a programme at the Ministry of Finance, Singha durbar today.

According to a press statement issued by the Finance Ministry, the Agreement shall come into force on a date to be notified by the both countries.

On the occasion, Minister Pun said the Agreement was signed as per the Organization for Economic Cooperation (OECD). The Agreement has clear provision of taxation related to cross border transaction, services and employment, he said. According to Minister Pun, with this agreement, the number of countries that Nepal has signed DTAA has reached 10.

On the occasion Minister Mukharjee said, “India has an abiding interest in the success of Nepal’s transition to multi-party democracy and the completion of the peace process. A peaceful, democratic and prosperous Nepal is in the interest of the Nepali people, of India and of our region.”

The Agreement that has also incorporated the provision of exchange of information as per the OECS is expected to help boost overall business and investment climate in Nepal.

Indian Minister Mukharjee returned home after the signing of the Agreement on late Monday afternoon. He had arrived in the morning.

Senior officers at the Foreign Ministry, Indian Foreign Secretary, the Indian Ambassador to Nepal and representatives from the Indian diplomatic mission reached the Tribhuvan International Airport to bid farewell to Mukharjee.