Retrospective taxation allows a country to pass a rule on taxing certain products, items or services and deals and charge companies from a time behind the date on which the law is passed. Corporate Tax: It is the tax on all the income or gains generated by corporations. "mainEntityOfPage": { The tax authorities are persisting with their demands of collecting retrospective taxes from Vodafone PLC and the U.K.’s Cairn Energy. }, "name": "civils360 ias", Context:. Do you think recent Haryana Government decision to reserve jobs for local would lead to “Balkanisation of the Indian labour market”? Gift Tax: It is the tax that an individual receiving the … Retrospective means Implementation new accounting policies for transaction, event, or other circumstances as if it had been implemented. The Income Tax authorities slapped Rs. "publisher": { Countries use this route to correct any anomalies in their taxation policies that have, in the past, allowed companies to take advantage of such loopholes. DAILY CURRENT AFFAIRS #ias #ips #upsc #civilservices #iasmains #iasinstitute #iascoaching #IASacademy #currentaffairs #ifs Retrospective taxation: … Government policies and interventions for development in various sectors and issues arising out of their design and implementation. By 2014, all attempts by the telco and the Finance Ministry to settle the issue had failed. Among the various agreements, the treaty had then stated that both countries would strive to “encourage and promote favourable conditions for investors” of the other country. In this article, all the topics are covered … Read more. In its ruling, the arbitration tribunal also said that now since it had been established that India had breached the terms of the agreement, it must now stop efforts to recover the said taxes from Vodafone. Comment. The Vodafone Group has won a long pending arbitration case against the Indian tax department’s demand of Rs 20,000 crore on a retrospective basis at the Permanent Court of Arbitration in Hague. If IAS is your destination, begin your journey with Santosh Sir. Retrospective Taxation. "url": "https://civils360.com/wp-content/uploads/2020/07/loGO-1.png" The Income Tax authorities slapped Rs. The two countries would, under the BIT, ensure that companies present in each other’s jurisdictions would be “at all times be accorded fair and equitable treatment and shall enjoy full protection and security in the territory of the other”. Share. Retrospective taxation under the Income Tax Act. In May 2007, Vodafone had bought a 67% stake in Hutchison Whampoa for $11 billion. In 2020, India lost arbitration cases to Vodafone and Cairn. It has ruled that the tax levy falls contradiction of the India – UK Bilateral Investment Pact. Examine how Retrospective taxation has been a major barrier in the Make-in-India effort. 24,500 crore pursued by India’s tax officials since 2014. Multifarious tax laws pose troubles in interpretation and implementation both. The opportunity has come to finally close the long chapter on retrospective tax that has done such damage to India’s reputation as an investment destination. A direct tax cannot be shifted to another individual or entity. Retrospective taxation refers to levying of taxes on goods and services already purchased or income already earned. Retrospective taxation justified, even US, UK, Netherlands have done it, says government; I-T dept allows manual filing by resident, NRI taxpayers for nil/lower TDS certificate (250 words) Reference: Business Standard , The Hindu Why the question: India has been … 30,700 crore penalty on Cairn Energy, the erstwhile U.K. parent of India’s largest private sector crude oil producer, Cairn India. "@type": "Organization", Permanent Court of Arbitration at The Hague: India’s retrospective demand of Rs 22,100 crore as capital gains and withholding tax imposed on the British telecommunication company for a 2007 deal was “in breach of the guarantee of fair and equitable treatment”. The court has also asked India not to pursue the tax demand any more against Vodafone Group. 30,700 crore penalty on Cairn Energy, the erstwhile U.K. parent of India’s largest private sector crude oil producer, Cairn India.
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