India Revises Budget 2012 Proposals; Clarifies Retrospective Amendments & Defers GAAR Implementation: Nair & Co.
2012 MAY 30 (VerticalNews) -- By a News Reporter-Staff News Editor at Telecommunications Weekly -- The Indian government has proposed certain revisions to the Finance Bill 2012 and has deferred the implementation of the General Anti-Avoidance Rules (GAAR). The Finance Minister also confirmed that the retrospective provisions for taxing Capital Gains Tax related to indirect transfers abroad on sale of assets in India will only be applicable in cases where the transfer has been routed through a low tax or no tax jurisdiction with whom India does not have a Double Taxation Avoidance Agreement.
The revisions to the tax evasion measures follow a recent move by Dutch telecommunications company Vodafone serving a Notice of Dispute against India's retrospective amendments in the Finance Bill 2012. Revisions to General Anti-Avoidance Rules (GAAR): Shift of onus of proof from the taxpayer to the Revenue Department in case of any action taken under the GAAR.
An independent member will be introduced in the GAAR panel to overlook the implementation.
To make sure that proposed transactions do not contravene provisions of the GAAR, resident as well as non-resident taxpayers can apply for an Advance Ruling. Read more at http://www.nair-co.com/IndiaTaxLaws-Budget2012.aspx Vodafone Serves Notice of Dispute against Indian Tax Law In response to India's tax evasion proposals such as GAAR and retrospective amendments introduced in the Finance Bill 2012-13, Vodafone has served a Notice of Dispute against the measures, which allows the government to change tax laws retroactively and empowers it to reverse Supreme Court rulings and judgments. Fearing that the new tax evasion proposals would overturn the Supreme Court's verdict, which ruled in favor of Vodafone in its $2.2 billion tax appeal, the Dutch telecommunications company has issued a Notice of Dispute which could involve international arbitration proceedings as per Netherlands' Bilateral Investment Treaty (BIT) with India. Read more at http://www.nair-co.com/VodafoneChallengesIndiaTaxLaw.aspx About Nair & Co. Nair & Co. provides you with your one touch outsourced finance, compliance HR and legal department for your international operations. If you are expanding abroad for the first time, our turnkey solution will help you do so with minimal risk, stress and cost. Nair & Co. supports 4000+ client operations in over 50 countries with core offices in U.K., India, China, U.S., Japan and Singapore. Nair & Co. was named among the top 100 outsourcing services providers in the world by the International Association of Outsourcing Professionals (IAOP). Learn more at www.nair-co.com
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