EYIndian Court rules on applicability of Most Favored Nation clause for determining withholding tax rate on dividend payments
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Executive summary
On 22 April 2021, India’s Delhi High Court (the Court) ruled in favor of non-Indian taxpayers on the issue of the rate of withholding tax applicable to dividend income received from Indian subsidiaries under the India-Netherlands tax treaty.1 The Court applied the principle of parity and granted a 5% withholding tax rate under the Most Favored Nation (MFN) clause of the treat…
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