Govt postpones GAAR implementation by 2 years to 2016
- Elections 2014 LIVE: Chandrababu Naidu's TDP back in NDA, ties up with BJP for polls
- Narendra Modi not my protege, a brilliant events manager: L K Advani
- Pakistan bike-snatchers turned terrorists for IMâs âjihad liteâ
- Solicitor General Mohan Parasaran holds AAP govt Reliance FIR illegal
- ICC Twenty20 final preview: On cupâs cusp
Giving a big relief to overseas investors, the government has postponed implementation of controversial GAAR provisions by two years to April 1, 2016.
"Having considered all the circumstances and relevant factors, the government has ...decided that provisions of Chapter 10A of the Income Tax Act (dealing with GAAR) will come into force from April 1, 2016 as against April 1, 2014,"
Finance Minister P Chidambaram said here today.
The General Anti Avoidance Rules (GAAR) provisions, introduced by the then Finance Minister Pranab Mukherjee in the Budget 2012-13, were aimed at checking tax avoidance by overseas investors. The proposal, however, generated controversy, with investors expressing apprehensions that it would result in unnecessary harassment by tax authorities.
The decision to postpone the implementation, Chidambaram said, follows the recommendations of the Shome Committee which was set up by Prime Minister Manmohan Singh in July last year to look into investor concerns.
The government, Chidambaram further said, has accepted major recommendations of the panel with some modifications.
"The modifications that we have done are fair, non-discriminatory, just and strike a balance between interest of revenue and interest of investors. So, all apprehensions should now be set addressed," he said.
The GAAR provisions, the Minister also clarified, would override the double taxation avoidance agreement (DTAA) benefits if the arrangements were intended solely to evade taxes.
No investor, Chidambaram said, "should now have any apprehension about his investments in India. Only those arrangements, which have been made for the purpose of tax avoidance, will be brought under GAAR, he added.
He also clarified that investments made by Non-Resident Indians (NRIs) will not be covered by the provisions of GAAR.
Following the announcement, the BSE benchmark Sensex rose by about 200 points to 19,864.
About the applicability of the GAAR provisions, he said FII investments seeking benefits under Sec 90 and Sec 90 (A) of the I-T Act (dealing with DTAA) would be covered.
- Ram temple matter of faith for BJP; focus on development issues: Uma Bharti
- Congress policies promoting growth of communal forces: Sitaram Yechury
- All Muslim bodies supporting Congress: Chidambaram
- No alliance with Congress in 5 assembly seats: Lalu Prasad Yadav
- Urban areas forgotten as campaigners focus on villages
- AAP tea vendor to take on BJP actor from Ahmedabad East
- Babri Masjid demolition sting: BJP questions timing, asks EC to stop telecast
- Apmaan ka badla lena hoga: Amit Shah in Muzaffarnagar | The Indian Express
- Arvind Kejriwal punched during roadshow in Delhi, AAP supporters thrash attacker
- Sentencing in Shakti Mills gang-rape case likely today, convicts may get death