Q7 · UPPSC current affairs · 15 October 2026 · News · India Mauritius Tax Treaty PPT Principal Purpose Test

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English हिंदी

Consider the following statements regarding the Principal Purpose Test (PPT):1.It is an anti-abuse rule designed to deny tax treaty benefits if obtaining a tax advantage was one of the primary purposes of a transaction.2.It is part of the OECD BEPS Action 6 and has been incorporated into revised Double Taxation Avoidance Agreements (DTAAs).Which of the statements given above is/are correct?

A Both 1 and 2

B 2 only

C Neither 1 nor 2

D 1 only

Correct answer: (a) Both 1 and 2

Explanation

Both statements are correct. Statement 1 accurately defines the Principal Purpose Test as an anti-abuse rule against treaty shopping. Statement 2 is correct because the PPT stems from OECD BEPS Action 6 and is incorporated into revised DTAAs such as the India-Mauritius tax treaty framework.

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These previous-year questions sit on the same topic. Open one to practise the earlier ask.

2024 · Q54 · UPPGS
Given below are two statements, one is labelled as Assertion (A) : and the other as Reason (R). Assertion (A): During 2023-24, Singapore emerged as the largest source of FDI to India. Reason (R): The India Mauritius Tax Treaty amendment has brought a major shift in countries as major sources of FDI to India. Select the correct answer from the codes given below:
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