oppn parties Welcome Decision On Retrospective Tax

News Snippets

  • Calcutta HC says Cricket Association of Bengal is not liable to pay tax on advertisement inisde Eden Gardens cricket ground as it is not a 'public place' because it does not have unrestricted access for the general public
  • Supreme Court admits a plea from a child of a single OBC mother who had applied for an OBC certificate for her son
  • Supreme Court approves applying strict preventive detention laws for 'cybercriminals'
  • SBI likely to shift part of operations of its Global Market Unit from Kolkata to Mumbai
  • FM nirmala Sitharaman calls for a "structured, process-driven approach to compliance" and asks top I-T officials to speed up refunds and simplify processes
  • Marine insurance costs surge as the oil corridor in Strait of Homruz becomes risky due to war
  • Stocks weaken on Monday on global cues: sensex sheds 511 points to 81896 and Nifty 140 points to 24971
  • Former left-arm spinner Dilip Doshi dies in London at 77. He played for India in 33 Test matches and for Bengal in domestic tournaments
  • Pant becomes the only keeper to score two centuries in the same Test in England
  • England Test: Rishabh Pant hits his second ton and KL Rahul a classy century to put India on top, England need 350 runs on the last day, with the ptich showing signs of wear and tear
  • DGCA orders an audit of the entire aviation ecosystem in the wake of recent snags in many flights after the AI Dreamliner crash in Ahmedabad
  • 2 Pahalgam residents arrested by NIA for sheltering and aiding 3 terrorists who killed civilian tourists in pahalgam tell the agency that there were 3 LeT ultras from Pakistan that carried out the attack
  • India unlikely to agree to US demands for lower tariffs on agri products and GM food, trade deal faces fresh hurdles
  • Stocks likely to plummet today as traders will be worried about the effect of US strike on iran, oil price rise and possible inflation. Foreign funds may also withdraw in the volatile global situation
  • Oil prices likely to shoot up as US strikes at iran and the latter decides to close the Strait of Homruz
US President Donald Trump unilaterally announces a 'ceasefire' between Israel & Iran
oppn parties
Welcome Decision On Retrospective Tax

By Sunil Garodia
First publised on 2021-08-05 14:09:24

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator.

The government today took a huge step in making India an investor-friendly destination. It tabled a Bill, Taxation Laws (Amendment) Bill, 2021 in the Lok Sabha that seeks to undo the damage of retrospective tax on indirect transfer of Indian assets that was introduced in the Finance Bill, 2012. It has also decided that it will refund the amount already collected under this retrospective tax, without interest, from companies like Cairns and Vodafone, if certain conditions are fulfilled by these companies. The government has also decided to reimburse legal costs, again without interest. The main conditions are that the companies will have to withdraw all litigations already filed and give an undertaking for not filing any new case on this matter and also furnish an undertaking that after the settlement under the proposed new law, they will not claim any costs, damages, interest etc. on this account.

It is good that the government has taken this step. It is wrong to change the goalposts in the middle of a game. When it is done by the government, it shows that it is trying to take unfair advantage from a done deal and is definitely tax 'terrorism'. It goes against ease of doing business. If laws are not transparent, prone to frequent changes and done with a desire to tax a deal with retrospective effect, they make a country an unfriendly investment destination. The NDA government, despite being painted as pro-rich and business friendly, continued to make the same mistake which the UPA government did by originally introducing the retro tax. It did not heed the arbitration awards in various international courts and sought to contest them, eroding further investor confidence. It also led to the ugly situation where Cairns got orders in its favour to seize Indian assets abroad to get refund.

The decision will come as a huge relief for the embattled Telecom major Vodafone-Idea which is hugely stressed and on the verge of closure if things do not work out soon. K M Birla has written to the government to buy his stake and has already stepped down from the board. It will also probably mean that Cairns will now withdraw the various cases it has filed against the GoI and settle the matter as per the new law. Both the government and the companies should now show flexibility and work things out smoothly. The government must also ensure that no such grossly unfair law is planned or introduced in future.