BRITISH chancellor George Osborne yesterday warned Indian authorities that a retrospective tax on cross border investment would hit the Asian country’s economic development.
Indian Prime Minister Manmohan Singh has already been advised against implementing the measures by international trade groups representing more than 250,000 companies.
The plans would retrospectively tax acquisitions of Indian assets, such as Vodafone’s 2007 takeover of mobile phone divisions in India. The new taxes “might damage the overall climate for investments in India”, Osborne said.
India’s taxman has already lost one court case attempting to force Vodafone to pay billions in tax on the deal.