News Details- (Get Professional Updates on Whatsapp, Msg on 8285393786) More News

CBDT begins consultation with stakeholders on GAAR

Posted Date : 28-May-2016 , 07:46:53 am | Posted By CASANSAAR print Print
Gearing up to roll out the General Anti-Avoidance Rule (GAAR) from April next to check tax evasion through overseas jurisdictions, the CBDT today initiated a consultation process with general public and all stakeholders on provisions of the new regime.

"The general public and stakeholders are therefore requested to provide their inputs on the provisions of GAAR in respect of which further clarity is required, from its implementation perspective," said a Central Board of Direct Taxes (CBDT) statement.

GAAR, which seeks to check tax evasion, will come into effect from Assessment Year 2018-19 (Financial Year 2017-18), it said, adding the necessary procedures for application of GAAR and conditions under which it will not apply have already been enumerated in the Income Tax Rules, 1962. The GAAR provisions were incorporated in the Income Tax Act, 1961.

The CBDT, which had received representations from industry associations with regard to implementation of the GAAR, asked the stakeholders to seek clarification by June 30.

The industry wanted the CBDT to issue guidelines so that there is adequate clarity with regard to implementation of GAAR.

To make the whole exercise meaningful, the CBDT said that while seeking clarifications the stakeholders should avoid reference to hypothetical situations.

"If the input relates to interpretation of a specific real world structure or arrangement, the structure should be such... (which) commonly occurs in the sector and involves clarification of general principles of application.

"Further, in relation to such structure, the particular provision and apprehensions or doubts along with basis thereof may also be provided with all the relevant facts," the CBDT statement said.

GAAR was introduced in his 2012-13 Budget speech by the then Finance Minister Pranab Mukherjee with a view to check tax evasion and avoidance. However, its implementation was repeatedly postponed because of the apprehensions expressed by foreign investors.

GAAR, which was originally to be implemented from April 1, 2014, will now come into effect from April 1 next year.

Besides other things, GAAR contains provision allowing the government to prospectively tax overseas deals involving local assets.

The government had earlier proposed imposing GAAR for those claiming tax benefit of over Rs 3 crore. The rules are aimed at minimising tax avoidance for investments made by entities based in tax havens. #casansaar (PTI)

Category : CBDT | Comments : 0 | Hits : 311

Search News
News By Categories More Categories