India and France Amend Tax Treaty
Analysis based on 7 articles · First reported Feb 23, 2026 · Last updated Feb 23, 2026
The updated tax treaty between India and France is expected to provide greater tax certainty for taxpayers and boost the flow of investment, technology, and personnel between the two nations. This will strengthen the economic relationship between India and France, potentially leading to increased bilateral trade and investment opportunities.
India and France have signed an Amending Protocol to their Double Taxation Avoidance Convention (DTAC), originally signed in 1992. The protocol, signed by Ravi Agrawal for India and Thierry Mathou for France during French President Emmanuel Macron's visit, introduces several key changes. It grants full taxing rights on capital gains from share sales to the jurisdiction where the company is resident, deletes the Most-Favoured-Nation (MFN) Clause, and modifies dividend taxation to a split rate of 5% for those holding at least 10% of capital and 15% for others. Additionally, it aligns the definition of 'Fees for Technical Services' with the India-US DTAC, expands the scope of 'Permanent Establishment' to include Service PE, updates provisions on Exchange of Information, and introduces a new Article on Assistance in Collection of Taxes. The protocol also incorporates applicable provisions of the BEPS Multilateral Instrument (MLI). These changes aim to update the DTAC to international standards, provide greater tax certainty, and boost investment and economic cooperation between India and France.
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