NEW DELHI: Union Finance Minister Pranab Mukherjee on Monday explained to UK Chancellor of Exchequer George Osborne, the Indian government’s position in the Rs 11,000-crore Vodafone tax issue and the proposed amendment in the Income Tax Act to recover such tax evasions.
Senior officials from UK and the Finance Ministry held meetings and discussed the impact of the Indian government’s proposed amendment on Vodafone, in the IT Act. The amendment in the 1961 IT Act aims to bring into net overseas mergers and acquisitions, involving domestic assets.
A source who attended the meeting said, “There was a sense of anxiety among the officials, but we explained our point of view and highlighted how such an amendment was necessary to protect the country’s interest.” The source also said a joint statement was drafted only after much deliberation on whether the Vodafone tax issue should be highlighted.
The joint statement said, “Both sides recognised the need for countries to sign the Multilateral Convention on Mutual Administrative Assistance in Tax Matters and engage in automatic exchange of information where legally required to improve tax compliance and decrease evasion.”