new delhi india today signed a double taxation avoidance agreement dtaa with colombia to crack down on tax evaders prevent money laundering and deal with other taxrelated offencesbesides facilitating economic cooperation between the two countries the agreement will help in dealing with fiscal evasion with respect to taxes on income an official release saidthe agreement would also allow effective exchange of information including banking data and assistance in collection of taxes between tax authorities of the two countriesit incorporates antiabuse provisions to ensure that the benefits of the agreement are availed of by the genuine residents of india and colombiathe agreement was signed by the central board of direct taxes cbdt chairman sudhir chandra and juan alfredo pinto saavedra colombian ambassador to indiathe issue of black money and tax evasion has assumed greater significance in the last couple of years after instances of indians having allegedly stashed away money in undisclosed locations abroad came to lightunder the agreement the profits derived by an enterprise from operating ships or aircraft in international traffic shall be taxable in the country of residence of the enterprisemoreover dividends interest and royalty income will be taxed both in the country of residence and in the country of sourcehowever maximum tax rate to be charged in the source country cannot exceed 5 per cent in the case of dividends and 10 per cent in the case of interest and royalties the release saidcapital gains from the sale of shares will be taxable in the country of source it addedbesides according to the agreement profits earned by a business enterprise would be taxable if the concerned project continues to operate in either india or colombia for over six months637 pm