Effects of Double Taxation Agreements between Tanzania and India on the Foreign Direct Investments
In: The African ReviewAbstract
The paper analyzed policy effects of Double Taxation Agreements (DTA) between Tanzania and India. The study employed desk study and mini-field research survey purposely to obtain primary data and qualitative information from the Tanzania Revenue Authority (TRA), High Commission of India and Indian companies. The paper found that Tanzania has no comprehensive national taxation policy which incorporates DTAs. The current treaties do not protect the government revenue losses. The loopholes include the denial of taxing the gains made by investors selling assets. However, the contribution of Tanzania-India DTAs in Foreign Direct Investment, (FDIs) flow in Tanzania has been significant positive. Indian FDIs have positive effects on Tanzanian employment. Moreover, the investments from India have brought massive capital flows and new technologies into the country. Tanzania-India DTA is more potential for sustainable national development. The study recommends the need to review and formulate New National Investment Policy 2019 that effectively integrate into sustainable fiscal and sector policies. Tanzania has to review all DTAs with aim of minimizing government revenue losses and to renegotiate all existing DTAs adopting UN Model Tanzania. It has to rationalize favoured bilateral treaties to signal their commitments to stable, correct, and often favourable treatment of foreign investors. Tanzania has to implement the Goal #17 of Sustainable Development Goal as that of “Partnering for Development” as a strategy to strengthen the means of implementation and revitalize the global partnership for sustainable development.
Purchase
Buy instant access (PDF download and unlimited online access):
Institutional Login
Log in with Open Athens, Shibboleth, or your institutional credentials
Personal login
Log in with your brill.com account
-
Anusree, P. (2014). Indian Foreign Direct Investment: A way to Africa” procedia. Social and Behavioral Sciences, 157, 183–195.
-
The Australian Council for International Development (ACFID). (2015). Partnering for Development. Retrieved from https://acfid.asn.au/sites/site.acfid/files/resource_document/Partnering-for-development-final.pdf. Office of Development Effectiveness, Department of Foreign Affairs and Trade.
-
Baker, P. (1994). Double Taxation Conventions and International Tax Law: A Manual on the OECD Model Tax Convention on Income and on Capital of 1992, 2nd ed. Sweet & Maxwell.
-
Bank of India. (2017). India’s Investments in Select East African Countries: Prospects and Opportunities. Working Paper No. 60. Export-Import Bank of India.
-
Bank of Tanzania, Tanzania Investment Centre and Zanzibar Investment Promotion Authority. (2012). Foreign Private Investment and Investor Perception. Tanzania Investment Report 2012. Bank of Tanzania.
-
Blonigen, B. A., & Davies, R. B. (2002). Do bilateral tax treaties promote foreign direct investment?” Working Paper No. 8834. National Bureau of Economic Research.
-
Blonigen, B. A., & Davies, R. B. (2004). The effects of bilateral tax treaties on U.S. FDI activity. International Tax and Public Finance, 11, 601–622.
-
CUTS. (2003). Investment Policy in Tanzania – Performance and Perceptions: A report prepared by the CUTS Centre for Competition, Investment & Economic Regulation D-217, India in association with Economic and Social Research Foundation, Dar-es-Salaam, Tanzania.
-
Davis, R. (2004). Tax treaties and foreign direct investment: potential versus performance. International Tax and Public Finance, 11(5), 775–802.
-
Deloitte Touche Tohmatsu Ltd. (2016). Tanzania Economic Outlook 2017 – The Story behind the Numbers. Deloitte Touche, Dar es Salaam, Tanzania.
-
Doernberg, R. (1997). International Taxation in a Nutshell, 3rd edition. West Publishing.
-
Ghose, A. K. (2004). Capital Inflows and Investment in Developing Countries. International Labor Organization.
-
Government of India. (2016). India – Tanzania Relations; Ministry of External Affairs of India.
-
Hamada, K. (1966). Strategic aspects of taxation on foreign investment income. Quarterly Journal of Economics, 80, 361–375.
-
Hines Jr., J. R. (1998). Tax sparing” and direct investment in developing countries. Working Paper, No. 6728. NBER).
-
Hines Jr., J. R. (1988). Taxation and U.S. multinational investment. In L. Summers (Ed.), Tax Policy and the Economy, 2, pp. 33–61. MIT Press.
-
High Commission of India. (2017). Various Publications in print and digital forms, Website Information and Data.
-
International Labour Organization. (2018). World Employment Social Outlook 2018: Greening with jobs. International Labour Office.
-
International Monetary Fund. (2014). Spillovers in International Corporate Taxation. IMF Policy Paper. International Monetary Fund.
-
Kabelwa, G. (2006). Potential impacts of FDI on economic development in Tanzania. Paper prepared for a Policy Dialogue for Accelerating Growth and Poverty Reduction in Tanzania, held at the Conference Hall, ESRF, on May, 2006.
-
Kabula. M. (2016). Double Taxation Agreements: Gain or Loss to Tanzania? Tanzania Tax Justice Coalition. Colour Print (Tanzania) Ltd.
-
Karuga. W. (2017). Permanent Establishments under Scrutiny. KPMG Advisory Services Ltd.
-
Nakayana. K. (2015). Tax Treaty Policy for Developing Countries. Dialogue with Developing Countries on International Taxation at Sixth IMF-Japan High-Level Tax Conference for Asian Countries in Tokyo, Japan.
-
Neumayer, E., & Spess, L. (2005). Do bilateral investment treaties increase foreign direct investment to developing countries? World Development, 33(10), 1567–1585.
-
Tanzania Investment Centre. (2015). Why Invest in Tanzania: An Overview of Investment Climate, Opportunities, Trends & Services. Tanzania Investment Centre.
-
United Nations. (2015). 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals. UN.
-
UNIDO. (2014). Tanzania Investor Survey Report: Understanding the impact of domestic and foreign direct investment. United Nations Industrial Development Organization.
-
UNCTAD. (2016). World Investment Report; Investor Nationality: Policy Challenges 2016. Division on Investment and Enterprise of UNCTAD.
-
UNCTAD. (2017). Investment and the Digital Economy 2017. Division on Investment and Enterprise of UNCTAD.
-
United Republic of Tanzania (URT). (1996). National Investment Promotion Policy. President’s Planning Commission.
-
United Republic of Tanzania (URT). (2015). Tanzania Mining Industry Tanzania Mining Industry Investor’s Guide Investor’s Guide. Ministry of Energy and Minerals.
| All Time | Past Year | Past 30 Days | |
|---|---|---|---|
| Abstract Views | 994 | 424 | 73 |
| Full Text Views | 7 | 1 | 0 |
| PDF Views & Downloads | 9 | 5 | 0 |
Effects of Double Taxation Agreements between Tanzania and India on the Foreign Direct Investments
In: The African ReviewAbstract
The paper analyzed policy effects of Double Taxation Agreements (DTA) between Tanzania and India. The study employed desk study and mini-field research survey purposely to obtain primary data and qualitative information from the Tanzania Revenue Authority (TRA), High Commission of India and Indian companies. The paper found that Tanzania has no comprehensive national taxation policy which incorporates DTAs. The current treaties do not protect the government revenue losses. The loopholes include the denial of taxing the gains made by investors selling assets. However, the contribution of Tanzania-India DTAs in Foreign Direct Investment, (FDIs) flow in Tanzania has been significant positive. Indian FDIs have positive effects on Tanzanian employment. Moreover, the investments from India have brought massive capital flows and new technologies into the country. Tanzania-India DTA is more potential for sustainable national development. The study recommends the need to review and formulate New National Investment Policy 2019 that effectively integrate into sustainable fiscal and sector policies. Tanzania has to review all DTAs with aim of minimizing government revenue losses and to renegotiate all existing DTAs adopting UN Model Tanzania. It has to rationalize favoured bilateral treaties to signal their commitments to stable, correct, and often favourable treatment of foreign investors. Tanzania has to implement the Goal #17 of Sustainable Development Goal as that of “Partnering for Development” as a strategy to strengthen the means of implementation and revitalize the global partnership for sustainable development.
| All Time | Past Year | Past 30 Days | |
|---|---|---|---|
| Abstract Views | 994 | 424 | 73 |
| Full Text Views | 7 | 1 | 0 |
| PDF Views & Downloads | 9 | 5 | 0 |