India Signs Record 174 Advance Pricing Agreements In FY 2024-25

The Central Board of Direct Taxes (CBDT) signed a record 174 Advance Pricing Agreements (APAs) with Indian taxpayers in the 2024-25 financial year, which ended on Monday.

The APA scheme provides tax certainty by determining the arm’s length price of international transactions in advance for up to five years.

Bilateral APAs also offer protection against potential or actual double taxation.

The CBDT, the policymaking body for the Income Tax Department, said it signed Unilateral (UAPAs), Bilateral (BAPAs), and Multilateral APAs (MAPAs) this year.

This marks the highest number of APAs signed in a single year since the programme’s launch.

In comparison, India signed 125 APAs in 2023-24 and 95 in 2022-23.

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Major economies like France, Japan, and Germany did not sign any APAs this fiscal year. The US, however, signed 142 agreements.

Of the 174 APAs, 65 were BAPAs, the highest recorded in a year.

India also signed its first-ever MAPA during this period.

These agreements resulted from mutual arrangements with treaty partners, including Australia, Japan, South Korea, the Netherlands, New Zealand, Singapore, the UK, and the US.

The total number of APAs now stands at 815, including 615 UAPAs, 199 BAPAs, and 1 MAPA.

The APA programme has improved India’s ease of doing business, particularly for multinational enterprises engaged in cross-border transactions.

The CBDT acknowledged the taxpayers’ role in the success of the programme.

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