The Government is considering a review of the Double Taxation Avoidance Treaty (DTAT) with Mauritius to boost revenues, Minister of State for Finance S.S. Palanimanickam said on Friday.
Palanimanickam told the parliament today that even after holding seven rounds of bilateral talks, the Indian Government has not received a favourable response from Mauritius to address the tax evasion issue.
"There was unwillingness on the part of Mauritius to cooperate in addressing this problem. Consistent efforts are being made by the Indian government to find mutually acceptable solutions for addressing India's concerns," he said.
Seven rounds of discussions have taken place so far, Palanimanickam said in a reply to queries from lawmakers in the Lok Sabha. However, no fresh dates have been finalised for the next round of talks on the issue, he said.
An India-Mauritius joint working panel was set up in 2006 to put in place adequate safeguards for preventing the misuse of the DTAT between the two countries.
Government officials have said that the country is losing more than US$600mn a year in revenue because of the tax treaty with Mauritius. Palanimanickam said today that 39.5% of the total FDI into India between April 2000 and February 2012 have been channeled through Mauritius.