sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
Service Tax »
 12 ways to avoid paying more for bank services
 I-T return filing: Income Tax offices, Ayakar Seva Kendras to remain open from March 29-31
 Top 5 money matters you must settle before March 31 From income tax returns to LTCG,
 Steep fines for missing March 31 income tax deadline
 CBEC clears some air on refunds under GST, central excise, service tax laws
 3 key tax changes for senior citizens which will come into effect from April 1, 2018
 Income tax returns (ITR) filing: Not filed returns for 2 years? Beware! Deadline nearing
 All you want to know about HRA: When you can claim and how it is calculated?
 Income Tax Saving: 6 ways to save tax without investing before March 31 tax deadline
 Unnable to file your tax return? Take help of these portals
 Do you know which 80C instruments can help you save tax and carry no future tax liability?

Tax dept blamed for policy uncertainty
May, 22nd 2014

The revenue department seems to be coming under renewed pressure over handling of tax issues with the commerce and industry ministry flagging the unpredictability of tax regime as one of the key issues deterring investments, even as the government has for the first time acknowledged that it allowed commodity futures trading without adequate regulatory checks and balances.

Although the focus so far has been on a plethora of tax disputes that the government has been entangled in — from Vodafone to Nokia and Shell — the commerce department, which had pushed for special economic zones (SEZs) to attract investment and boost exports, has blamed the revenue department for levying taxes after the Centre had explicitly promised a zero-tax regime.

The comments are in response to a Cabinet secretariat driven exercise to find out steps that could have been avoided during the UPA government's tenure.

When the SEZ law was enacted in 2005, it was clearly provided that neither minimum alternate tax nor dividend distribution tax would be levied. But, finance minister Pranab Mukherjee withdrew both the concessions, after the tax department complained of loss of revenue. Officials said it was the first instance of the government going back on its promise and international investors took note of the issue. What followed subsequently was a retrospective amendment to the Income Tax Act to allow imposition of capital gains tax on Vodafone's acquisition of Hutch's stake in its Indian telecom operations despite the Supreme Court ruling that the tax department did not have any jurisdiction over the issue.

Even the department of industrial policy and promotion (DIPP), which deals with foreign direct investment, has flagged the predictability of tax regime as an area of concern. It is also critical of the free trade agreements that India has signed and sees it as one of the factors eroding Indian manufacturing, a concern which is shared by the finance ministry as well.

Several corporate chiefs have already gone public against the revenue department's stance but attempts by Mukherjee and his succecsor P Chidambaram failed to rebuild confidence in the tax authorities. The commerce ministry, which has piloted the trade pacts, has, however, listed them as an achievement despite Indian industry crying foul over imports getting cheaper.

What has come as an even bigger setback is the consumer affairs ministry's admission that the department "should not have created the commodity market without adequate regulatory checks and balances". The market, which has lost some sheen in recent months after a spate of controversies, has been waiting for a full-time regulator on the line of Sebi and RBI for several years as the UPA government failed to amend the law governing trading in commodities trading. As a result, the penalties remain weak and the regulator FMC does not have direct control over manipulators.

The confusion in the space was evident in the collapse of the National Spot Exchange Ltd (NSEL) where settlements of Rs 5,500 crore are still awaited. In fact, NSEL is another failure that consumer affairs ministry acknowledged.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
SEO Company Search Engine Optimization Company US SEO Local SEO Company Website SEO Company Alabama SEO Company Alaska SEO Company Arizona SEO Company Arkansas SEO Company California SEO Company Colorado SEO Company Connecticut SEO Company Delawa

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions