India and the US could soon unveil details of a deal designed to resolve more than 100 outstanding tax disputes. The two sides almost finalized the outline of a mutual agreement procedure (MAP). Numerous discussions on the issue are said to have taken place since Indian Prime Minister Manmohan Singh called for an end to the impasse during his visit to the US in September 2013.
The MAP would provide a mechanism for the speedy negotiation of acceptable settlements to tax disputes. The tax cases in question could then be withdrawn from formal legal processes, “providing relief to companies and releasing tax revenue to the government.”
It is hoped that the MAP will be used to clear a backlog of tax cases involving subsidiaries of US companies. An estimated INR80bn (USD1.29bn) in tax revenue is still disputed, with some cases having been on hold for over three years.
