India has set up the proposed high-level panel to resolve the controversial levy of minimum alternate tax (MAT) on foreign portfolio investors, one of the reasons for outflow of capital from the country that caused Rupee to depreciate.
The committee headed by chairman Law Commission justice AP Shah and have former chief economic advisor Ashok Lahiri and Girish Ahuja.
Initially, the committee would focus on the issue of MAT on FIIs and give its report expeditiously. The committee may interact with various stakeholders as it may deem fit as also invite officers from Department of Revenue, including CBDT, for consultations or discussions as may be necessary, an official statement said on Wednesday.
The Committee shall set its own procedure for regulating its work. The term of the committee will be for one year or such period as may be notified by the government from time to time. Tax authorities will not issue fresh notices or take coercive action in cases where demands have been raised, pending the panel’s recommendations.
As FIIs pulled out funds from markets, the Government last month sought to soothe the nerves of jittery foreign investors saying those FIIs coming from countries with which India has a double taxation avoidance pacts would be exempt from the 20 per cent MAT levy.