Taxation of indirect share transfers : recent developments in India and related policy considerations

Resource Information

The work Taxation of indirect share transfers : recent developments in India and related policy considerations represents a distinct intellectual or artistic creation found in International Bureau of Fiscal Documentation. This resource is a combination of several types including: Work, Language Material, Continuing Resources.

Label

Taxation of indirect share transfers : recent developments in India and related policy considerations

Creator

• Cope, C.W
• Jain, P. (Parul)

Subject

• case law
• share transfer
• tax policy
• tax treaty

Language

eng

Summary

Source country taxation of indirect share transfers made by nonresidents has, for some time now, been a subject of focus for both tax authorities and multinational groups. A handful of countries, including India and China, have enacted legislation (or interpreted older legislation) to allow the taxation of such transfers, primarily as an anti-avoidance measure intended to protect the taxation of direct share transfers by nonresidents. These countries now are seeking to enforce their tax laws and collect this tax. Moreover, interest in this type of tax is growing among developing countries. A recent paper presented at a United Nations workshop on protecting the tax base of developing countries advocates taxing the capital gains of nonresidents and discusses how to improve taxing indirect share transfers. The future, therefore, probably will see more countries asserting jurisdiction to tax such transfers. Taxes on indirect share transfers raise a variety of fundamental questions, including the scope of included transactions, determination of the correct taxable amount, collection and payment of the tax, consistency with income tax treaty obligations, whether the tax is creditable, and, perhaps most significantly, whether source country taxation of such share gains is good tax policy. This article reviews the history of the Vodafone transaction and recent developments in India, discusses some of the issues raised by such taxes in the context of the Indian and U.S. tax systems, and considers briefly the broader policy issues

Citation source

In: Tax management international journal. - Arlington. - Vol. 44 (2015),

Language note

English