Tax notice to FIIs is not tax terrorism, says Jaitley

“We are targeting tax stability but India should not be treated as a tax haven,” says FM at CII meet

GN Bureau | April 6, 2015


#Arun Jaitley   #CII   #finance minister   #tax notice   #FIIs   #foreign financial institutions   #MAT  

Union finance minister Arun Jaitley has termed tax notices sent to around 100 overseas funds as as legitimate tax demand and not tax terrorism. Jaitley said taxes need to be paid where the demand was right, while wrongful demand would go into litigation.

Speaking at inauguration of CII national conference and annual session the finance minister said “we are targeting tax stability but India should not be treated as a tax haven."  Jaitley promised to appoint a group to oversee working of new companies act to find out where the shoe pinches. He also said the government will move GST (goods and services tax) Constitutional Amendment Bill in Lok Sabha in next few weeks.

Nearly, 100 overseas funds have been slapped with tax notices estimated at $5-6 billion for 'untaxed gains' made by them in the Indian markets over the past years. They have now approached the government citing fresh concerns over the Indian tax regime. These foreign institutional investors (FIIs) got notices from the tax department for a controversial minimum alternate tax (MAT) of 20 per cent, while they are now being followed up with assessment orders.

Top officials said that the Authority for Advance Rulings had ruled in tax department's favour, which allows it to levy MAT on capital gains. "Every action against foreign players should not be blown out of proportion. Other countries have similar laws, India alone doesn't have such laws," a senior official has said. The notices are in line with the norms prior to the introduction of the Finance Bill 2015.

The FIIs have, however, decided to challenge the tax demands, stating that MAT cannot be levied on FIIs or foreign portfolio investors (FPIs) as they do not earn any 'business income' in India and their income is defined as ‘capital gains’ under the I-T Act. The government has proposed to amend the law. However, the amendments will take effect from April, 1, 2016.

Officials defended the notices saying that they have been issued under the current legal regime.

Comments

 

Other News

What India needs to do to finally become a superpower

For the past 25 years, India has been rising in stature. It is continually called an upcoming superpower but has been unable to reach the promised status. India’s importance in the world is more due to its immense population and potential as a market than any objective assessment of development. Indi

Would keeping an army tank at JNU instil nationalism?

Would keeping an army tank at JNU instil nationalism?

Yogi in politics, TN industries shift base and, how to end the Maharaja’s misery

Everyone in Yogi Adityanath`s office declares that Yogi’s political career is founded on the work carried out from there, first when he was mahant of the influential temple, and then as an MP. Vijendra Singh, who works at the office, says “It’s because of these letters that Yogiji has n

A fifth of Rs 29 lakh crore are NPAs

Banks have advanced a staggering Rs 29,46,060 crore to the industrial sector, of which Rs 6.93 lakh crore are non-performing assets (NPAs).   Finance minister Arun Jaitley informed

Demonetisation not meant to change cash use by people: Harvard economist

 Here are 10 things that Kenneth Rogoff, Thomas D Cabot professor of public policy, department of economics, Harvard University, and author of `The Curse of Cash`, said about demonetisation at the Delhi Economics Conclave 2017: 1. The core idea for demone

Ashok Malik is press secy to president

As Ram Nath Kovind readies to take charge as president, the government is forming his team, naming three officials.    Ashok Malik, former journalist and commentator known for his pro-right views, will serve as the press secretary to the president. Bharat Lal, Gujarat&rs





Video

कश्मीर पर तीसरे पक्ष की मध्यस्थता स्वीकार नहीं - महबूबा

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter