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Finance Bill 2012 Passed – What It Means For You?
The Finance Minister (FM), tabled the Union Budget 2012 in Parliament on 16 March 2012. Thereafter, based on the suggestions and recommendations received from both the members of Parliament and the public at large with respect to the tax proposals, the FM proposed certain amendments to the Finance Bill 2012. Lok Sabha has passed the amended Finance Bill 2012 approving all the amendments proposed by the FM. The amended Finance Bill 2012 will now be tabled before Rajya Sabha which will return it for Presidential assent. Taxand India examines the provisions introduced in the Finance Bill 2012 with a look at how this may affect businesses in India.
Taxand India discusses in greater detail the key amendments proposed including direct and indirect tax proposals
The FM has acknowledged the fact that the GAAR provisions introduced in the Finance Bill 2012 need to be reworked to provide 'checks and balances' with adequate guidelines to be formulated to ensure effective / proper implementation of GAAR provisions. The deferment of provisions and other amendments in relation to GAAR, has come as a respite to taxpayers as it is hoped that the final law along with rules will ensure that the anti avoidance legislation is applied in a fair and just manner.
The FM has emphasised in his speech that retrospective amendments in the Finance Bill 2012 relating to capital gains on sale of assets located in India through indirect transfers abroad, shall not override the provisions of Double Taxation Avoidance Agreement ("DTAA") and will not be used to reopen any cases where assessment orders have already been finalised.
Read our media commentary: India to defer GAAR Implementation (Tax News 9 May 2012)