New Delhi: Industry body CII Wednesday said the government's announcement that minimum alternate tax will not be imposed on overseas portfolio investors retrospectively will boost India's position as a favourable investment destination, help reduce litigation and resolve disputes.
"This step would boost confidence of the global investor community and would go a long way in strengthening India's position as a favourable investment destination.
"The decision of the government to do away with MAT on FIIs is a welcome step. It would help in reducing litigation and resolving disputes in favour of FII taxpayers," said CII Director General Chandrajit Banerjee said.
In a big relief to FIIs, the government on Tuesday accepted recommendation of a high-level panel that minimum alternate tax (MAT) should not be imposed on overseas portfolio investors retrospectively.
Finance Minister Arun Jaitley said the panel headed by Law Commission Chairman A P Shah submitted its final report on August 25 on the issue of applicability of MAT on capital gains made by FIIs prior to April 1, 2015.
"It will re-affirm the faith of the investor community in the Indian taxation system as being fair and judicious. The trade and industry expect the government to adopt a similar proactive approach in clarifying other pending tax issues. Apart from reducing litigation, such measures will help improve investor confidence and growth of Indian economy," Ficci stated.
