<<Aiii>> Why FIIs are not going ga-ga over GAAR

What is GAAR, and why are FIIs so concerned about it? The General Anti-
avoidance Rules (GAAR) are being introduced as part of the proposed
Direct Tax Code 2010 (DTC 2010). Introduction of DTC 2010 is part of
the tax reforms process that is expected to level the playing field
for different categories of tax payers, and plug some of the loopholes
through which tax revenues are vanishing.

There is a fine line between avoiding taxes and evading taxes. Proper
tax planning using permitted provisions in the tax laws can lead to
legal avoidance of taxes. Holding equity shares of companies for more
than a year before selling them for a profit to avoid paying capital
gains tax, or selling a piece of land and investing the proceeds in
Capital Gains tax bonds are examples of legal tax avoidance. GAAR
provisions will not apply to such transactions.

Blatant tax evasion - by hiding income from tax authorities or not
paying adequate amount of excise duty by bribing excise inspectors or
mis-labelling finished products as manufacturing waste - is punishable
under current laws. GAAR provisions are not meant for such instances
either.

Read more at:

http://tinyurl.com/mobugobu

--
Independent Investor Handbook
http://tinyurl.com/3octm2r

Ultimate Technical Analysis Handbook
http://tinyurl.com/yej8kem

How to Use Bar Patterns to Spot Trade Setups
http://tinyurl.com/yhszv6t

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