Feeds

Vodafone manages to fight off £3bn tax bill, claws back cash paid

What happens in India never happened in India

Security for virtualized datacentres

Vodafone's acquisition of Hutchison Essar is not liable to Indian taxation, a court has ruled, as the 2007 transaction took place outside the sub-continent - despite Essar being based there.

Vodafone and Hutchison successfully argued at the Indian Supreme Court that as neither company is headquartered in India they don't have to stump up for local capital-gains tax, which could have hit £3bn once all the various penalties for late payment were included.

So now the Indian government will have to pay back the bonds and guarantees amounting to several hundred million quid which Vodafone was forced to hand over during the four years the case rumbled on.

The Indian tax office reckoned Vodafone should have handed over £1.4bn in capital gains tax before the deal was allowed to go through in 2007, and won a couple of rounds at court before the matter reached the Supreme Court whose ruling is final.

The issue was whether two foreign-owned companies trading an Indian company between them could be liable for Indian tax. Had Vodafone and Hutchinson been Indian companies then Vodafone would have been obliged to deduct the tax from the price paid to Hutch, passing it direct to the government.

The news will settle the minds of companies considering their investment in India, and is being heralded in the international press as a good thing, though the Indian tax authorities might feel differently. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Facebook pays INFINITELY MORE UK corp tax than in 2012
Thanks for the £3k, Zuck. Doh! you're IN CREDIT. Guess not
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
YARR! Pirates walk the plank: DMCA magnets sink in Google results
Spaffing copyrighted stuff over the web? No search ranking for you
Microsoft EU warns: If you have ties to the US, Feds can get your data
European corps can't afford to get complacent while American Big Biz battles Uncle Sam
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
prev story

Whitepapers

Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.