50 Biggest Tax Influences - Justice Kapadia, ITAT President and Sushil Mody in list
INTERNATIONAL Tax Review has announced its list of 50 biggest influences in International tax.
Three Indians figure in the list:
1. Justice Sarosh Homi Kapadia,Chief Justice of India about whom ITR says, “In the area of international taxation, his judgments, have gone a long way in clarifying the law relating to, transfer pricing ( Morgan Stanley) , deduction of taxes on salaries paid to expatriates ( Eli Lilly) , deduction of taxes on royalty payment on software ( GE India Technology ), and definition of permanent establishments for the purposes of double taxation avoidance agreements ( Morgan Stanley) . In a time where the growing liberalisation and globalisation of India's economy has presented new and complex forms of economic activity, his judgments on such areas as the taxation of income under production sharing contracts for oil and natural gas ( Enron Oil & Gas) , and dividend stripping ( Walfort Stocks & Shares ) have helped lay down a certain and decisive course for tax law to follow in many years to come. Before completing his tenure as the Chief Justice of India in September 2012, Justice Kapadia is also poised to lay down the law on the taxation of offshore mergers and acquisitions of Indian companies in the legal challenge to the tax demand on Vodafone International's acquisition of Hutchison Essar's telecommunication business in India from the Hong Kong based Hutchison Group which was heard by a three-judge bench headed by him. This is probably the first case of its kind being heard by the highest judicial authority, not only in India but anywhere in the world, and Justice Kapadia's judgment in this landmark case is likely to have a decisive impact on the future development of international tax jurisprudence. At a time when several multi-billion dollar cross-border M&A transactions are coming under the scanner of revenue authorities, Kapadia's judgment is likely to lay down the marker for revenue authorities and tax practitioners everywhere on the taxation of such transactions. Chief Justice Kapadia is highly acclaimed for his deep knowledge of law, impeccable integrity, for being a hard taskmaster and for restoring the institutional integrity as well.”
2. GE Veerabhadrappa was appointed as the President of the Indian Income Tax Appellate Tribunal (ITAT) last month. The ITAT has released countless rulings on the treatment of transfer pricing in India, with more than 100 rulings in transfer pricing this year alone. It stands as a major influence in the approach to the practice, with taxpayers all over the world using the numerous decisions as benchmarks for their own documentation and transfer pricing strategy. ITR has used our citation and mentioned, “The Delhi Tribunal in Abhishek Auto Industries Limited vs Deputy Commissioner of Income Tax (2010-TII-54-ITAT-DEL-TP), of November 12 2010, ruled that the tax authorities cannot reject a legally binding inter-company agreement, for payment of royalty or technical fees approved by regulatory agencies, simply because there is no commercial need for the arrangement”.
3. Sushil Modi , finance and deputy chief minister of the state of Bihar, was elected this year to chair the committee in charge of implementing GST, he became one of the most important tax officials in India. ITR says, GST has been delayed a number of times and the latest predictions suggest it will miss its April 2012 implementation date. The process has been marred by disagreements between the states, with a number of Bharatiya Janata Party (BJP) state governments opposed. It falls to Modi to build a consensus on the issue and as a BJP politician, he may be ideally placed to do just that.
The list includes Japan's new finance minister, Jun Azumi, John Colvin, Chief Judge of the US Tax Court and the chairperson of the African Tax Administration Forum, Oupa Magashula who said that he would take 75 officials from India to help them create a simple system!