1 / 6

A Passage to India!

A Passage to India!. Nikhil V. Mehta, Barrister and Advocate Rendezvous Room Taj Mahal Tower 14 th October 2014. A Brief Fiscal History. 1973: Exchange controls tightened by diluting foreign equity to 40% max The continuing rise of the black economy: avoidance unnecessary

jillian-lara
Download Presentation

A Passage to India!

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. A Passage to India! Nikhil V. Mehta, Barrister and Advocate Rendezvous Room Taj Mahal Tower 14th October 2014

  2. A Brief Fiscal History • 1973: Exchange controls tightened by diluting foreign equity to 40% max • The continuing rise of the black economy: avoidance unnecessary • 1991: Liberalisation introduced • 2009 onwards: the Vodafone saga • 2009: Direct Taxes Code Bill introduced (still a draft) • 2012: Retrospective legislation enacted • 2012: White Paper on Black Money • GAAR, but postponed to 1/4/2015 • 2014: New BJP Government with overwhelming majority

  3. Tax Avoidance and Tax Evasion • Background in tackling tax evasion has influenced India’s approach to tax avoidance • Distinction blurred • Same tax officials involved in both • Courts have been the protectors of legitimate tax avoidance through development of a judicial doctrine based on English law from the Duke of Westminster’s Case

  4. Lawmakers and Guardians • Finance Ministry wants to attract foreign investment, but still responsible for raising revenue • Tax authorities want to raise the tax take • The Courts want to apply the rule of law

  5. Tax Behavioural Changes • An urgent need for clarity and consistency • What is the message for foreign investors? • Scaling back of aggression • Distinguish avoidance and evasion • Better advance ruling mechanisms • Of course, taxpayers need to behave too!

  6. Conclusions • If the GAAR is introduced next year, that will be a real test of the tax administration, as they will need to exercise their new powers judiciously. • Possible that new Government will postpone it. • Next critical step will be the first full Budget of the new Government in February 2015. Golden opportunity to steady the fiscal ship.

More Related