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Undid a past mistake on corporate taxation, took bold decisions on reforms: PM Modi

The Indian government's move to end retrospective tax signified the undoing of a mistake in made in the past, Prime Minister Narendra Modi said at the annual meeting of the Confederation of Indian Industry or CII

Aug 12, 2021
Image
Prime Minister Narendra Modi

The Indian government's move to end retrospective tax signified the undoing of a mistake in made in the past, Prime Minister Narendra Modi said at the annual meeting of the Confederation of Indian Industry or CII.

The government last week ended taxes raised for the indirect transfer of Indian assets before May 2012, if companies withdrew pending litigation and gave an undertaking that no damages claims would be filed.

"We undid a mistake of the past by removing retrospective tax. It will increase trust between the government and the industry," Modi said at the CII meeting Wednesday held online. "The feedback and appreciation from industry in this regard has been great to see."

In 2012, the previous United Progressive Alliance government controversially changed tax laws retrospectively. International companies which had acquired assets of Indian companies before then were told they had to pay huge amounts. This led to a fierce legal fight between the government and the companies, NDTV said.

The cases were met with a huge outcry among foreign investors and also dealt a blow to the government of former Prime Minister Manmohan Singh, who lost power in a 2014 election to Modi.

In what was seen as a swipe at past governments, Modi said his National Democratic Alliance has taken "bold decisions" on reforms and did not let even the pandemic slow it down.

"Talk on the need for reforms in the country has been going on for ages, but no one took any decision. We did. We make and carry out reforms not out of compulsion but out of conviction," Modi said.

"There used to be a mind set in India that change is very difficult. For us to emerge from where we are is a massive task. So, nothing happened for decades, but in the last few decades, that has changed. That change has been spearheaded by you all - the industry," he said.

"Today, Indians believe in the products made in India. The mindset that only foreign brands are good has changed... Start-ups are showing self-confidence. Several unicorns are becoming the image of the nation. Seven-eight years ago India might have had just three-four unicorns. Today, there are nearly 60 unicorns in India. Out of these, 21 have been developed in the last few months,"Modi said.(SAM)

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