In a bid to bring ‘greater clarity’ on GAAR (General Anti-Avoidance Rules) and prepare its implementation roadmap by September 30, Prime Minister Manmohan Singh, on Friday, constituted an expert committee to prepare and finalise guidelines for the hitherto controversial tax provision.
“The Prime Minister has approved the constitution of an Expert Committee on GAAR to undertake stakeholder consultations and finalise the guidelines for GAAR (General Anti-Avoidance Rules)… This committee would manage the consultation process and finalise the draft GAAR Guidelines,” a PMO statement said.
Coming as it does within a fortnight of the Finance Ministry placing a set of draft guidelines on GAAR in public domain for debate and feedback, the four-member committee headed by ICRIER chief and taxation expert Parthasarathi Shome has been asked to vet the norms on the basis of feedback from stakeholders.
Other members of the committee are: N. Rangachary, former Chairman of Insurance Regulatory and Development Authority (IRDA), Ajay Shah, Professor at economic think-tank NIPFP, and Sunil Gupta, Joint Secretary, Department of Revenue in the Finance Ministry.
As per the PMO’s plans, the Shome committee will receive comments from stakeholders and general public till the end of this month, instead of the July 20 deadline that was set in the Ministry’s draft. Based on the feedback, the expert panel will rework the guidelines and publish the second draft by August 31 and thereafter finalise the GAAR guidelines and a roadmap and submit these to the government by September 30, 2012.
Explaining the reason for changes in the finalisation process even as the draft has brought about clarity on some fronts, the PMO statement said: “There is a need to have greater clarity on many other fronts…this Expert Committee which will bring transparency and a high degree of technical expertise to the consultation process”.
Though in short term it may make FII's run away but in long term we
as a nation gets benefitted and as we say that the interest of the
nation comes first always and every time.
It is good that Prime Minister is taking steps to reign in an ill-conceived and ill-times GAAR that deters foreign exchange inflow just when India needs the most. Pranab Mukherji stint as finance minister has been a complete disaster for the country.
This is a welcome move to hold consultation before imposing any tax. Industries have a powerful lobbies to force its will on government but I'm more worried about common man who does not have access to any such powerful lobbies and end up getting robbed by government by paying direct taxes at one hand and endless indirect taxes, cess, levies, custom, excise, VAT, service charges etc on other.
in stead he can think of think of finding a way to see that the collected tax are well spent without being looted by politician and thrown away as freebies to lazy fellows.
Please Email the Editor