ISLAMABAD, Aug 4: Pakistan and Austria on Thursday signed a convention for the avoidance of double taxation and fiscal evasion with respect to income between two countries. CBR Chairman M. Abdullah Yousuf and Austrian Ambassador to Pakistan Dr Guenther Gallowitsch signed the convention on behalf of their respective governments.

Pakistan will benefit through the convention from sharing of tax on income from shipping business, immovable property, interest, royalties, fee for technical services and capital gains. Besides, income from business activities would be taxable at the place of permanent establishment. Apart from these, students, trainees, teachers, etc., of any contracting state will be entitled for a tax exemption for a period of six months to two years.

These incentives will greatly help in attracting foreign direct investment (FDI) towards Pakistan and generate commercial activities, casting a positive effect on economy. Besides, the convention will not only provide safeguard against double taxation on income of the residents of both the countries, but also promote economic cooperation and will further strengthen the existing bilateral economic and trade relations between the two countries.