Disallowance for Failure to Withhold on Outbound Payment Violates India-U.S. Non-Discrimination Clause

Volume 3 No 6    |    Read Article

By Neha Rastogi and Nina Krauthamer

To withhold, or not to withhold: that is the question. Neha Rastogi and Nina Krauthamer review the Herbalife case in India that allowed an Indian subsidiary to deduct an administration fee paid to a related parent company for services performed in the U.S. without imposing an obligation on the company to withhold Indian tax. The case, which relates to the tax year 2000 to 2001, has dragged on for many years. In 2004, the law was changed, but the litigation continued.    See more →