No vindictive intention behind amending tax laws, says Pranab
Finance minister Pranab Mukherjee said on Sunday that the government has no vindictive intention behind the proposal to retrospectively amend tax laws and does not plan to open a plethora of old cases by making changes in the Income-Tax Act. HT reports. Bridging the trust deficitbusiness Updated: Mar 26, 2012 02:10 IST
Finance minister Pranab Mukherjee said on Sunday that the government has no vindictive intention behind the proposal to retrospectively amend tax laws and does not plan to open a plethora of old cases by making changes in the Income-Tax Act.
He said the budget proposal has been made to protect revenue erosion and to check outflow from exchequer.
The finance minister said government through double taxation avoidance agreement (DTAA) and tax information exchange agreement (TIEA) wants to ensure that any foreign investor investing in India should not be taxed twice and also one should not get away by not paying tax at all.
"I can assure the industry that there is no intention of opening plethora of the old cases on this plea or that plea because that is simply not permissible (under the laws)," he said while addressing the industry representatives at a Confederation of Indian Industry meeting on Sunday.
In the Budget 2012-13, Mukherjee had proposed amending the Income-Tax Act with retrospective effect to bring into tax net overseas transactions like the Vodafone-Hutchison deal, which was criticised by a section that it would hamper investment in the country.
Without referring to the recent Supreme Court's order on Vodafone, the minister said, though the Supreme Court was 'ultimate interpreter of law that does not take away the right of the legislators to express its intentions'.
"In every year's finance bill, some retrospective amendments are introduced to enhance the clarity of the taxation regime," he said.
On behalf of the industry, member of Parliament and Bajaj group chairman Rahul Bajaj said the corporate sector is concerned over the proposal to retrospectively amend tax laws and opening of cases on a back date.