The government would soon finalise the taxation aspects for the overseas listing of shares by the various Indian companies. Finance Minister Nirmala Sitharaman said on Monday that the government departments have held a couple of meetings regarding taxation issues concerning overseas listing and have “fairly completed the process”.
Market players have sought exemption from levy of capital gains tax, arising from transfer of shares of an Indian company by non-residents in overseas market. The Revenue Department had some concerns on this issue. Officials from the department, and corporate affairs and commerce ministries have held two rounds of meeting on this issue and the tax rules are close to being finalised.
Sitharaman said while the government is working on the tax issues, the Indian equity markets themselves are becoming a haven for raising money. Recent successful listing of shares by several startups and mid-size firms have emboldened the chances for fund raising activity in India.
Last May, the Centre announced that Indian companies would now be allowed to list shares directly in foreign stock exchanges, but consequent rules and clarity on taxation aspects are awaited.
Speaking to reporters at a briefing on Monday, Sitharaman said the economy is clearly coming out of the challenges posed by the second wave, and the recent set of legislative reforms should provide an impetus to economic activity. She said inflation is expected remain benign even as the Centre continues to focus on growth.
“Inflation will be well within its limit and I will not allow that (the prospect of rising inflation) to worry me,” the FM said. She also indicated that the Centre will not cut excise duty on petrol and diesel to provide relief against high prices, stressing that payments in lieu of past subsidised fuel pose limitations.
Petrol and diesel as well as cooking gas and kerosene were sold at subsidised rates during the UPA government. Instead of paying for the subsidy to bring parity between the artificially suppressed retail selling price and the cost that had soared because of international rates crossing $100 per barrel, the then government issued oil bonds totalling Rs 1.34 lakh crore to state-fuel retailers. These oil bonds and the interest thereon are being paid now.
“If I did not have the burden to service the oil bonds, I would have been in a position to reduce excise duty on fuel … Previous governments have made our job difficult by issuing oil bonds. Even if I want to do something I am paying through my nose for the oil bonds,” she said. The interest on oil bonds paid in the last seven years totalled Rs 70,195.72 crore.