Retrospective Levy - Vodafone Disappointed

By Vijay Kumar

NOW that it is almost certain that the Finance Bill will be enacted in a few days, Vodafone is sure to get the demand from the income Tax authorities. Vodafone in a statement yesterday said, "We are naturally disappointed that despite very widespread concern in India and internationally, the government has not seen fit to propose amendments to address the uncertainty caused by retrospective tax legislation."

Vodafone added,

We are studying the legislation as amended and will take all possible steps to safeguard our shareholders' interests.

It would be grossly unjust if, on the basis of legislation passed five years after the event, Vodafone were to be charged tax on a gain made by someone else, especially where the Indian Supreme Court unambiguously ruled that no tax was payable in India according to the laws of India in force in 2007 .

Vodafone said it had put in Rs. 50,000 crore in the Indian operations and was one of the largest taxpayers in the country with over Rs. 29,000 crore paid as taxes. And despite making considerable investments over the last five years, the company said it is yet to take a single rupee out of the country.