New Delhi: The Revenue Department has submitted amendments to GAAR, the controversial law against tax avoidance, to the Prime Minister's Office (PMO), Finance Minister P Chidambaram said Wednesday.
He also said that India is working on more clarity in tax laws and a non-adversarial tax regime.
"It's (amendments to GAAR rules) with PMO. When PMO clears it, you will come to know. Our exercise is over as far revenue department is concern," he told reporters here.
The government is working on the recommendations of Parthasarathy Shome Committee, which had suggested modification in laws dealing with General Anti-Avoidance Rules (GAAR) and retrospective tax law amendments.
Separately, according to an official statement, the minister said while welcoming an Australian delegation, led by Deputy Prime Minister and Treasurer Wayne Swan that India is working towards clarity in tax laws and a non-adversarial tax administration to promote investor confidence.
"We are working towards clarity in our tax laws, to have a stable tax regime and non-adversarial tax administration and fair mechanism of dispute regulation. These have been very well received by both the foreign and domestic investors, market and public at large" he said.
Chidambaram said that in the last five months, government has taken several measures to bring the economy back to high growth path through fiscal consolidation, addressing inflation concerns, external sector vulnerabilities and increasing investor confidence.
GAAR, which was proposed in Budget 2012-13 to prevent tax evasion, evoked sharp reactions from foreign as well as domestic investors who feared that unbridled powers to taxmen would result in harassment of investors.
The government deferred its implementation to April 1, 2013. It appointed the Shome committee to look into their concerns.
The committee recommended postponement of the tax proposal by three years and abolition of capital gains tax on transfer of securities.
Besides, it recommended that GAAR be applicable only if the monetary threshold of tax benefit is Rs 3 crore and more.
The Shome Committee had also given recommendation on the retrospective tax amendment.
On issues related to retrospective amendment, Chidambaram told reporters, "decisions have been taken but drafting is going on".
The retro-tax amendments, which sought to undo the Supreme Court order in the Vodafone tax case, evoked sharp reaction from overseas investors.
On India-Australia ties, Chidambaram said in the statement that partnership has led to a rapid expansion in trade and investment ties between two countries.
He said trade between the two countries has more than doubled in the past six years to more than USD 20 billion.
He also said that India's investment in Australia has also been increasing and a large number of Indian IT companies have made their presence in Australia.
In terms of inward investment, Australia is currently the 20th largest investor in India.
"There is a huge opportunity for increase in investments from Australia into India particularly in sectors like mines and minerals based industry, clean and renewable energy, food processing bio-technology, marine and fishery among others," Chidambaram said.
There is big opportunity for Australian companies to invest in India especially in infrastructure sector, he added.
Swan, on his part, suggested measures to boost production, especially in the agriculture sector.