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Vodafone May Compromise on Indian Tax Demand
Published on:
Vodafone has offered a compromise in its long-running Indian tax dispute, according to the Indian government's Finance Minister, P. Chidambaram.
He suggested that the compromise could be the acceptance of payment of the outstanding tax demand, but cancellation of the penalties, that could in theory double the amount being demanded.
Vodafone has contested the US$2.2 billion tax demand ever since it bought its US$11.7 billion stake in the local mobile network, and after it won the legal argument, the government retrospectively changed the law to make the demand valid again.
Vodafone has threatened to go to international arbitration, although both sides have been seeking a face-saving way of extracting themselves from the dispute.
The latest government Budget which was issued this week did not include any provision for the payment of the tax demand though.
On the web: BusinessLine
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