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FM vows to solve Vodafone tax tangle

Chidambaram: Upbeat

:London, Jan. 29 (PTI): Finance minister P. Chidambaram today expressed confidence that the government would find a solution to the Vodafone tax issue.

After meeting global investors, he said the issue figured only peripherally and came up as a question.

“I did clarify to them that Vodafone has formally offered to engage with the Indian government in discussions. They had two rounds of discussions with the government officials. I am confident that we will find a resolution to the Vodafone issue so that we can put it behind us and move forward,” he said.

Vodafone has been slapped with an income tax demand notice of Rs 11,200 crore on its 2007 acquisition of Hong Kong-based Hutchison Whampoa’s stake in its Indian telecom business.

Meanwhile, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has stayed the department of telecom’s order that directed Vodafone to pay Rs 3,599 crore as a one-time spectrum fee till its next hearing on February 25. A single-member bench of TDSAT said there would be “no coercive action” against the company.

Budget hint

Chidambaram today held out an assurance that the budget next month would be a “responsible” one as the general elections were 15 months away.

Addressing global investors in London, on the fourth leg of his overseas road shows that began last week, the finance minister said the government would implement many of the decisions and changes in the run-up to the polls. He expressed confidence that foreign funds inflow would improve after these road shows, which had shown that India had enormous goodwill.

Chidambaram said investors had expressed reservations about the political stability and capacity of the government to take reforms forward. They pointed out that elections were due in 2014 and “will we waver or falter in the run-up to the elections”.

 
 
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