The Finance Ministry is keen to ensure that honest taxpayers are not troubled when the much dreaded anti-tax avoidance rules — GAAR is implemented from April 1 next year.
There has to be no misuse of GAAR, Mr R.S. Gujral, Finance Secretary, told the Chief Commissioners of Income-Tax and Directors’ General of Income-Tax at an annual conference in the Capital today.
While the General Anti Avoidance Rules (GAAR) have entered the statute book through the recent Finance Act 2012, it will be implemented only from April 1, 2013.
There were widespread reservations, especially among foreign investor community, to the implementation of GAAR as proposed in the Finance Bill 2012.
To give more time for the tax department and also the foreign investors to adjust to the new regime, the Finance Minister, Mr Pranab Mukherjee, had deferred the implementation of GAAR by one year.
Mr Gujral said that the anti-tax avoidance rules will not be applicable for the current fiscal income.
He also made it clear that the Finance Ministry does not want GAAR to be seen as an “unbridled power’’ in the hands of the taxman to trouble honest taxpayers.