I-T officials strive to get rid of ‘tax terrorists’ tag
Vivek Prasad, chief commissioner of Income-Tax – III, Mumbai said they were striving to rid themselves of the unwarranted epithet of ‘tax terrorists,’ and said with regards to tax morality, base erosion, profit shifting and GAAR (general anti-avoidance rules) they were on a learning curve and are evolving beyond the earlier double-taxation avoidance agreements.
Speaking at the CII’s CEO Summit, he said in the slowing global economy, governments were losing tax revenue and facing increasing fiscal pressure. But they had to compete and have tax and regulatory policies aimed at attracting international investors, while providing adequate revenues for their various schemes.
“It was felt business oug-ht to contribute their fair share of tax to the countries in which they operate. The opportunities for MNCs to pay less tax harm everybody; even small or new domestic businesses cannot compete with the tax shifting multi-national enterprises. The OECD (Organisation of Economic Co-operation and Development) had last year released a 15-step action plan to address tax avoidance-double non-taxation or low taxation through base erosion and profit shifting,” he said.
Speaking about GAAR, he said the work of fine-tuning the provisions is underway to iron out further ambiguities. They are also in the process of re-negotiating certain tax tre-aties to specifically include anti-abuse provisions like limitation of benefits rules and beneficial ownership clauses.
Meanwhile, PTI quoted Akhilesh Ranjan, joint secretary in the finance ministry official as saying that the global base erosion and profit shifting (BEPS) rules, aimed at collecting a fair share of taxes from multinationals operating in different tax jurisdictions, are likely to be finalised by December 2015.
“Businesses should gear up, prepare themselves for the changes in the tax legislation, and government is equally open to consider views of the industry,” Mr Ranjan added.
