Indian taxpayers are welcoming a new weekly government forum for discussing tax concerns with industry, but say transparency on both sides is necessary to make the meetings effective.
Companies that pay the management costs associated with defined benefit (DB) pension schemes should be able to recover VAT after the European Court of Justice (ECJ) ruled in favour of Dutch firm PPG Holdings.
Companies in India are struggling with the tax authorities’ disjointed approach to litigation, often needing to dispute issues the courts have settled in previous cases. Cairn Energy’s head of taxation believes a centralised litigation strategy by the authorities would help to make the environment less uncertain for taxpayers.
Legitimate foreign tax planning could be at risk after the tax community’s perceived narrow role of Canada’s foreign affiliate anti-avoidance rule was rejected by the Tax Court of Canada in Lehigh Cement.
The Delhi Income Tax Appellate Tribunal (ITAT) has found that revenue earned by one of Microsoft’s US branches on the sale of products to Indian distributors constitutes royalty, but that Microsoft is not liable to tax because it would see the same income taxed twice.
India’s Ministry of Finance has put a new competent authority in place and announced that the government is keen to provide a suitable mechanism for resolving tax disputes with foreign multinationals. Advisers say the government may finally be backing up Minister of Finance Palaniappan Chidambaram’s rhetoric on attracting foreign direct investment (FDI) with some concrete action.
