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India’s Transfer Pricing Problem

Transfer Price is the price of the goods and services sold between related entities such as – parent company and daughter (subsidiary) company; or between branches of same entity. The fixing of price of goods and services between parent-subsidiary is called Transfer Pricing. Tax Avoidance Using Transfer Pricing Transfer pricing itself is not a means […]

What is Treaty Shopping?

Treaty shopping is considered to be a means of tax avoidance. The bilateral tax treaties are done to reciprocate the benefits between the residents of two countries but when someone from a third country invests in any of them just for the sake of avoiding tax and derives the benefits of low taxation, this is […]

Tax Avoidance, Tax Evasion and Tax Planning

There are three different concepts viz. tax avoidance, tax evasion and tax planning. Tax Avoidance means an attempt to reduce tax liability through legal means, i.e. to regulate one’s financial affairs in such a way that one pays the minimum tax imposed by the law. This can be understood with a simple example. Tax Evasion and […]