Expert Views: India defers GAAR measures by a year

GAAR deffered by one year

The Finance Minister today made an announcement about General Anti-Avoidance Rules. He, in the parliament, said that India will delay by one year until fiscal 2013/14 the introduction of measures to crack down on tax evasion.

Here's what the experts have to say about it

COMMENTARY

Radhika Rao, Economist, Forecast PTE, Singapore

"These comments should provide short-term relief to the domestic markets, however, the decision to put the onus on tax authorities to prove liabilities could infuse some extent of ambiguity and subjectivity into the proposals.

"For now, the markets will cheer clarity on the provisions and deferment of the implementation date."

Sandip Sabharwal, CEO, Portfolio Managemt, Prabhudas Lilladher, Mumbai

"GAAR deferral is extremely good for markets and economy as a lot of fund flows had come to a stand still because of this."

"At a time when our current account deficit is so high we can't scare away foreign capital. Now that GAAR is deferred, India will stop underperforming global peers at least."

MARKET REACTION

- The rupee was trading at 53.01 to the dollar, strengthening from 53.20 before the announcement.

- The BSE Sensex was down 0.5%, cutting losses of nearly 1%.