CA Online

Govt looks to plug a loophole in buybacks as these are not taxed like dividend payouts.  Cash-rich Indian IT services companies may now offer more dividends to return cash to shareholders, against the recent norm of share buybacks that have become less attractive with the budget proposing to introduce a new tax.   “Buyback is the most efficient way to return capital in India because it was not taxed earlier. It also helps companies improve the value when they think the market is not fairly pricing the stock,” said V Balakrishnan, a former finance chief of InfosysNSE 0.27 %. “Suddenly you tax buyback, companies will shift to dividend because buyback comes with its own hassles.” Share buybacks by listed companies aren’t taxed currently, but there is a 15% tax on dividend payment. To discourage companies from using this loophole, the budget has proposed a 20% tax on the money spent on share buybacks. Technology services companies have been rewarding shareholders by buy...

CBDT chief says after the Budget proposals only biometric ID is enough for tax purposes The assessing officer of the department will use his powers to allot PAN to an entity New Delhi: The taxman will 'suo motu' allot a fresh PAN to a person who files tax returns with only Aadhaar as part of a new arrangement to link the two databases, the CBDT chief said after the Budget proposed that only the biometric ID is enough for tax purposes. The PAN (permanent account number) is "certainly not dead" and the recent Budget announcement of interchangeability of the two databases is an "additional facility" to ensure their linkage, which is now mandatory under the law, Central Board of Direct Taxes (CBDT), chairman, Pramod Chandra Mody, said. "In cases where Aadhaar is being quoted and PAN is not there, we could possibly think on the terms of allotting a PAN to the person (who is filing income tax return)," he told PTI in an interview. Mody was aske...