Example of benefit from the double taxation convention: Suppose interest on NRAs [clarification required] bank deposits draw 30 percent tax deduction at source in India. Since India has signed agreements with several countries to avoid double taxation, the tax can only be deducted at 10-15% instead of 30%. Some investments with a flow or passing structure, such as . B Master-Limited Partnerships, are popular because they avoid double taxation syndrome. Currently, about 3,000 DTAs are in service worldwide. The use of the DBA to promote global trade is a key policy of the Organisation for Economic Co-operation and Development (OECD): by eliminating the threat of double taxation, the OECD can help promote the free movement of capital, goods and people and ultimately improve the functioning of free and open markets. Various factors, such as political and social stability, an educated population, a sophisticated public health and justice system, but above all corporate taxation, make the Netherlands a very attractive country where they do business. The Netherlands applies corporation tax at a rate of 25%. Resident taxpayers are taxed on their global income. Non-resident taxpayers are taxed on their income from Dutch sources. In the Netherlands, there are two types of double taxation relief. Economic double taxation relief is available for the proceeds of significant equity stakes in the participation.
Resident taxpayers receiving foreign income receive legal aid in the event of double taxation. In both cases, there is a combined system that makes a difference in active and passive income.  The concept of double taxation of dividends has been the subject of considerable debate. While some argue that the taxation of shareholders on their dividends is unfair because these funds have already been taxed at the corporate level, others argue that this tax structure is fair. Cyprus has 45 double taxation agreements and is negotiating with many other countries. Under these agreements, a credit is normally accepted against the tax collected by the country in which the taxpayer is established for taxes collected in the other contracting country, resulting in the taxpayer not paying more than the higher of the two rates. Some contracts provide for an additional tax credit that would otherwise have been due had it not been provided for incentives in the other country, which would have resulted in an exemption or tax reduction. In the event of a conflict between the provisions of the Income Tax Act or the Double Taxation Convention, their provisions apply. The result of double taxation is that certain activities are taxed more heavily than similar activities exclusively within the control of tax sovereignty.
The result is an unnecessary relocation of economic activity to reduce the frequency of taxes or other more insoulating forms of tax evasion. Businesses, in particular, have had the most double taxation problems, but individuals may also find it uneconomical to work abroad if all of their income is taxed by two authorities, regardless of the source of the income. The requirement that a company or individual pay two separate taxes on the same property for the same purpose and during the same period. Sub-Chapter C of the Internal Revenue Code, the federal government applies double corporate taxation by taxing corporate profits and profits distributed to the company`s shareholders through dividends.