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Withholding tax

Tax on income imposed at source, i.e. a third party is charged with the task of deducting the tax from certain kinds of payments and remitting that amount to the government. Withholding taxes are found in practically all tax systems and are widely used in respect of dividends, interest, royalties and similar tax payments. The rates of withholding tax are frequently reduced by tax treaties.

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withholding tax for interest payments and there were some Reserve Bank of India (RBI) barriers that are still in place. Credit spreads can’t be more than 500 basis points for more than five year paper

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