On 7-10-2015, the Union Cabinet approved the protocol amending the Convention and the Protocol between India and Israel for avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income and on capital. Earlier, Double Taxation Avoidance Convention (DTAC) was signed between India and Israel in 1996 through which both the countries agreed to exchange information on tax matters.
The Protocol provides for effective exchange of information between the two countries on tax matters without domestic tax interest. It also provides that the information received from Israel in respect of a resident of India can be shared with other law enforcement agencies with authorisation of the Competent Authority of Israel and vice versa. It further provides for ‘Limitation of Benefits’ Article to prevent misuse of the Convention and also enables use of the provisions of domestic law and measures concerning tax avoidance or evasion in the event of misuse of the Convention.
-Press Information Bureau