During 2022-23, Pakistan solidified agreements with four foreign tax jurisdictions aimed at the Avoidance of Double Taxation and the Prevention of Fiscal Evasion concerning Taxes on Income.
The Federal Board of Revenue (FBR) disclosed that Pakistan engaged in pivotal negotiations with several countries. The initial round of discussions between Pakistan and Norway, held in Oslo from November 28-30, 2022, focused on revising an existing Convention related to tax matters.
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Further negotiations ensued with Afghanistan in Islamabad from February 1-3, 2023, culminating in the initiation of an Agreement to prevent double taxation and fiscal evasion concerning income taxes.
Similarly, talks with Lithuania in Vilnius also led to significant progress, resulting in the initialization of an Agreement concerning the Avoidance of Double Taxation and Fiscal Evasion regarding Taxes on Income.
The data unveiled that Pakistan’s Model draft agreement concerning Taxes on Income, aimed at preventing fiscal evasion, received approval.
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Additionally, Pakistan notified a Protocol updating the Exchange of Information Article in an existing Convention related to the Avoidance of Double Taxation with Tajikistan.
Pakistan achieved key milestones in its commitment to international tax practices, including completing Peer Reviews under various BEPS (Base Erosion and Profit Shifting) Actions, such as countering harmful tax practices, preventing treaty abuse, and successful Mutual Agreement Procedure reviews, as per the FBR report.
