Finance Minister Pranab Mukherjee has announced that the General Anti-Avoidance Rules (GAAR) will be applied from 2013-14 onwards, deferring its application by a year. He also said that the onus of proof will lie with the tax authorities and that the proposed retrospective amendment of income tax laws will not override DTAAs with 82 countries. He also proposed an STT of 0.2% on the sale of unlisted securities. and that the capital gains tax on private equity will be halved to 10 per cent.
Reduced capital flows prompted the RBI to raise the interest rates banks can offer non-resident Indians to encourage them to bring in dollars. The Sensex ended below the 17,000 mark for the first time since January 24, 2012, closing at 16,831 -down 320 points.
The mass disparagement evoked scepticism and annoyance among officials of the finance ministry.
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