Beijing, Nov 30 (IANS) The double taxation avoidance pact between India and Hong Kong came into effect on Friday after both sides completed the due procedures.
A special administrative region of China, Hong Kong enjoys a high degree of autonomy “under one country, two system”.
The agreement between India and Hong Kong for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income was signed on March 19.
“India completed all the relevant procedures required by its laws for the entry into force of the agreement on May 11 and the government of Hong Kong Special Administrative Region completed all the relevant procedures required by its laws for the entry into force of the agreement on November 30,” the Indian consulate in Hong Kong said in a press release.
The pact will stimulate flow of investment, technology and personnel from India to Hong Kong and vice versa. It will prevent double taxation and provide for exchange of information between the two sides.
The agreement will also improve transparency in tax matters and will help curb tax evasion and tax avoidance, the consulate said.