The Parthasarthy Shome Committee on General Anti Avoidance Rules (GAAR) has recommended the postponement of implementation of GAAR guidelines by the government. The implementation of the GAAR guidelines is likely to affect the working of foreign companies in India.
The rollout of measures to crack down on tax evasion, which had sparked an outcry among foreign investors, but has yet to provide clear guidelines on the proposals.
Here are some quick facts on GAAR:
* The GAAR was proposed in mid-March as part of the budget for fiscal 2013.
* GAAR aims to target tax evaders, partly by stopping Indian companies and investors from routing investments through Mauritius or other tax havens for the sole purpose of avoiding taxes.
* However, the ambiguous language, the lack of details, and the sudden onset of the provisions have been among the factors that have upset foreign investors.