Buyback tax (BBT) provisions were introduced in the Income Tax Laws (ITL) in 2013 to check tax avoidance by unlisted companies, which resorted to buyback of shares instead of dividend distribution, particularly where the buyback distribution proceeds were tax-exempt for overseas shareholders under the treaty network. BBT is payable by domestic unlisted companies in the … More Taxation of buybacks by unlisted companies: a step toward greater clarity?
The Indian Finance Minister, Mr. Arun Jaitley, seems to be confident of pushing GDP growth upward and continuing the reforms agenda. At the recently concluded annual meeting of the World Economic Forum in Switzerland, he mentioned that one main reform, which is still work in progress, is “ease of doing business” in India and steps … More Mergers and Acquisitions reforms essential to drive growth agenda
Worldwide, trade balances are in a state of flux. Large multi-national enterprises (MNEs) of the world are raking in profits; however, are they paying their fair share of corporate tax or are they resorting to aggressive tax planning? Governments are looking for ways to recover public deficits by expecting MNEs to pay their “fair share … More BEPS and the Transactions landscape
“Coherence”, “transparency” and “substance” – these words have become the focal point of every discussion surrounding transactions today. In India, the glass ceiling on the importance of these terms was broken a few years ago with the advent of GAAR in the Direct Tax Code and retroactive amendments for taxation of indirect transfers. However, the … More Transactions in the BEPS world: the road ahead
An uncertain business environment, depreciating rupee, rising inflation, low investor confidence due to several grey areas in regulations such as indirect transfer, possible onslaught of GAAR surrounded the new government as it presented its first big bang budget.
The new Government has been focusing on improving the business environment as well as economic growth and development. Hopefully, this will lead to “Acche Din” for Mergers and acquisitions. A more robust and transparent tax and regulatory environment is key to transformation in investor sentiment and appetite.
Strategic acquisition of a target by an acquirer by paying the seller more than the company’s book net worth is fairly common in Mergers & Acquisitions (M&A) deals. The purchase price is generally based on the fair market value of assets/business. This typically occurs since the fair valuation of target factors in the value of … More Tax depreciation on Goodwill arising in M&A deals – is it a settled position?