Govt will resolve GAAR issue soon: Montek
2 July 2012 7:40 AM GMT
The finance ministry under Prime Minister Manmohan Singh will very quickly ‘resolve’ uncertainty among investors caused by anti-tax avoidance rules which were unveiled in the Budget, Planning Commission deputy chairman Montek Singh Ahluwalia said on Sunday.
‘As soon as budget was presented, it was clear that General Anti Avoidance Rules [GAAR] is going to create problem,’ he said.
However, he said, the finance ministry, now under the Prime Minister, ‘will resolve uncertainty among investors’.
When asked if former finance minister Pranab Mukherjee was a problem, he said, ‘No, I think this is something we don’t want to be carried away ... newspapers are always trying to put one minister against another. The art of taxation is difficult ... you have to give credit to the previous finance minister, after all he postponed the application of GAAR’.
He said that GAAR is a larger issue and it ‘caused lots of uncertainties among investors... the government actually recognised that by postponing implementation of GAAR’.
Referring to the finance ministry’s draft guidelines on GAAR provisions, he said they have taken care of some of the problems.
‘I think the government should look carefully at informed opinion and informed comments on whether these rules take care of all the problems that are creating difficulty and then address them,’ he added.
On retrospective tax amendments, the deputy chairman said he does not think it was introduced because of Vodafone tax issue. On economic growth, Ahluwalia said they should happen, but they should not be seen as reasons behind economic slowdown as the country had posted over 9 per cent GDP growth in their absence.
‘As soon as budget was presented, it was clear that General Anti Avoidance Rules [GAAR] is going to create problem,’ he said.
However, he said, the finance ministry, now under the Prime Minister, ‘will resolve uncertainty among investors’.
When asked if former finance minister Pranab Mukherjee was a problem, he said, ‘No, I think this is something we don’t want to be carried away ... newspapers are always trying to put one minister against another. The art of taxation is difficult ... you have to give credit to the previous finance minister, after all he postponed the application of GAAR’.
He said that GAAR is a larger issue and it ‘caused lots of uncertainties among investors... the government actually recognised that by postponing implementation of GAAR’.
Referring to the finance ministry’s draft guidelines on GAAR provisions, he said they have taken care of some of the problems.
‘I think the government should look carefully at informed opinion and informed comments on whether these rules take care of all the problems that are creating difficulty and then address them,’ he added.
On retrospective tax amendments, the deputy chairman said he does not think it was introduced because of Vodafone tax issue. On economic growth, Ahluwalia said they should happen, but they should not be seen as reasons behind economic slowdown as the country had posted over 9 per cent GDP growth in their absence.
Next Story
