Seeking to lift investor sentiments, the government today said that it will not wait for the Budget, which is due in February, to address the issues concerning retrospective amendment to Income Tax laws. “Once we take a view (on Shome Committee report), I see no reason why we should wait for the Budget session. We should move whatever changes have to be brought about in Parliament as early as possible,” Finance Minister P Chidambaram told reporters here.
The Committee, headed by tax expert Parthasarathi Shome, had last week submitted its report on retrospective tax amendment to the Finance Minister. “The Shome Committee report on retrospective legislation is under examination and we would have to complete that examination quickly and take a view,” Chidambaram said. The Committee was mandated to suggest measures to deal with retrospective amendment of I-T laws and tax treatment of cases that involve indirect transfer of Indian assets such as the Vodafone-Hutchison deal in 2007.
The committee was also asked to examine taxation of non-resident transfer of assets where the underlying asset is in India, in the context of foreign institutional investors (FIIs) operating in India purely for portfolio investment and all non-resident investors.
Chidambaram said the Finance Ministry after taking stakeholders view on the report would decide whether an amendment to I-T Act was necessary or there was any other way to resolve the matter. “Resolution of the tax disputes, both pending and anticipated, is good for the country, good for the economy and good for investments. So we must find ways to resolve the issue,” he added.
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