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IFA Congress 2014: Judges Seminar

Published on Tue, Oct 14,2014 | 16:35, Updated at Tue, Oct 14 at 16:45Source : Moneycontrol.com 

The 68th Annual Congress of the International Fiscal Association (IFA) opened last evening with a congregation of over 1500 tax delegates from across the world.

Today, on the second day of this conference, one of the highlights was the "Judges Seminar" where Tax Judges from US, Canada, France & India shared their perspective on some key international tax issues & offered delegates a unique opportunity to get a perspective of how these issues could be looked at by decision makers from countries across the world. The seminar was moderated by eminent Jurist Soli Dastur & the panel members were Justice James S. Halpern from US, Justice Vineet Kothari from India, Justice Philippe Martin from France & Justice Eugene Rossiter from Canada. The Firm's Payaswini Upadhyay was there at this landmark event & gives us a quick summary of what happened at the much awaited Judges Seminar…

Soli Dastur opened the seminar in style, he said - "Not very often an advocate gets a chance to put a Question to a judge & then hope to get a reply!"

Following are some of the important questions that the judges were asked & their response to each of them:

'IN YOUR RESPECTIVE COUNTRIES, TREATY OVERRIDES ACT, IF MORE FAVORABLE? WHAT WILL BE THE EFFECT OF INTRODUCTION OF A SUBSEQUENT ADVERSE PROVISION?

Justice Martin, France: Article 55 of the constitution says International Treaties are superior to domestic legislation

Justice Martin, France: In some cases, courts have denied domestic tax deductions & treaty has prevailed

Justice Halpern, US: Treaty that overrides statutory law would be supreme; Congress can override treaty by rewriting statute

Justice Rossiter, Canada: Domestic laws adopt treaty language


CAN TAXPAYERS CHERRY PICK BETWEEN DOMESTIC ACT AND TREATY?

Justice Martin, France: Treaty applies objectively and entirely

Justice Halpern: Taxpayers can choose favorable of the two; US allows cherry picking

Justice Rossiter, Canada: Domestic law and tax treaty cannot be used as alternates. Treaty applies objectively & entirely

Justice Kothari, India: Cherry picking is forbidden fruit in India!


IMPACT OF DOMESTIC TAX LAW ON INTERPRETATION OF TREATIES?

Justice Rossiter, Canada: Treaty overrides but govt can unilaterally change an adverse outcome by issuing a clarification

Justice Halpern, US: Treaties are looked at as purposive documents

Justice Martin, France: No specific statute on Treaty interpretation. Left to the courts to interpret

Justice Kothari, India: Domestic laws have only a persuasive value in Treaty interpretation


DOES YOUR COUNTRY HAVE SPECIFIC GAAR PROVISIONS? IF NOT, HAVE COURTS EVOLVED RULES TO COUNTER TAX AVOIDANCE?

Justice Halpern,US: US doesn't have GAAR but that doesn't mean courts don't have an arsenal,if you will! Elaborates that with Goldstein story.


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