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Question

Consider the following statements about Tax Information Exchange Agreements (TIEAs):

Which of the above statements is/are correct?


A

1 and 4 only

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B

3 and 4 only

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C

1, 2 and 3 only

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D

All of these

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Solution

The correct option is C

1, 2 and 3 only


Tax Information Exchange Agreements (TIEAs) provides for the exchange of information on request relating to a specific criminal or civil tax investigation or civil tax matters under investigation. This exchange of information on request was supplemented by an automatic process .The automatic process is to be based on a Common Reporting Standard. Typically, a TIEA contains the following provisions:

(a) It provides for exchange of information that is "foreseeably relevant" to the administration and enforcement of domestic tax laws on the Contracting Parties.

(b) The information provided under TIEA is protected by confidentiality obligations. Disclosure can be made to courts or judicial forums only for the purpose of determination of the taxation matter in question.

(c) Information requested may relate to a person who is not a resident of a Contracting Party.

(d) There is an obligation on part of requested Party to gather information if it is not in its possession, notwithstanding that it does not itself need that information. Therefore, no "domestic interest" for tax purposes is required for the provision of information.

(e) Information is defined in an expansive manner to cover banking details, ownership details of companies/persons/funds/trusts etc.

(f) Apart from exchange of information, representatives of one Party may be permitted to conduct tax examinations in territory of another party including interviews of individuals and examination of records.


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