Final guidelines on GAAR likely to come out by Oct-end: FM

In line with prime minister-appointed Parthasarthy Shome committee‘s recommendations, Finance Minister P Chidambaram has confirmed that General Anti Avoidance Rules (GAAR), will come out by October end. He emphasized that the stage-one finalization of the proposal will take place in next 10 days and the stage-two - the final GAAR rules would be ready by another 10 days as it would require a careful and critical examination by the Ministry of Law.

If required, at the third stage, amendment of the Income Tax Act will take place, which will take time as it has to be sent to the cabinet. In its proposal submitted to the ministry last month, the committee had suggested deferring implementation of the rules by three years on administrative grounds. In view of wide-spread concerns by foreign investors, the government had earlier postponed the implementation of GAAR by one year, which was introduced by the then Finance Minister Pranab Mukherjee in his Budget for 2012-13 to check tax evasion.

The prime minister had appointed the committee under the chairmanship of Parthasarthi Shome in July this year, to look into the matters pertaining tax issues.