Assuring multinational companies that they will not be taxed twice, the finance ministry on Friday said India was considering Double Taxation Avoidance Treaty with more countries, to ensure there are no tax disputes in international transactions.

"MNC taxpayers should feel assured that if they pay legitimate share of taxes, the problem of sharing should be resolved by the tax administrators of the two jurisdictions through the mechanism provided in the DTA agreement," Revenue Secretary Vineeta Rai said addressing a tax conference in New Delhi.

MNCs fear that inadequate provisions in tax laws lead to taxation of their income at home as well as in the country where it has subsidiaries.

Rai said Indian government pursued DTA agreements with major economic partners so that commerce was not hampered on the account of dual taxation.

"India is further committed to entering into equitable DTA agreements with new countries as well. Negotiations are at an advanced stage with many countries," she said.

Highlighting the importance of taxation in a liberalized economy, Rai said India has taken a number of initiatives, like signing DTA agreements with new countries, setting up an Authority for Advanced Ruling and a Directorate General of International Taxation and enacting laws on transfer pricing.

Admitting that tax disputes crop up even after having a well-drafted DTA agreement, she said, "To avoid any double taxation in the home country, MNCs should insist on claiming exemption on the income taxed at source or claiming credit for the tax so paid in their home country."