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Vodafone Tax Row: Cabinet Okays Conciliation

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The cabinet on Tuesday, 4 June '2013 approved the start of a conciliation process with Vodafone Group Plc, a minister said, in a dispute over more than $2 billion in taxes stemming from its 2007 acquisition of mobile phone assets in India.

Last year, the Supreme Court of India ruled in Vodafone's favour, saying that the UK telecoms carrier was not liable to pay any tax over the acquisition.

But the Indian government later in the year changed the rules to enable it to make retroactive tax claims on already-concluded deals, drawing criticism from global business groups.

Vodafone and Indian authorities have been in talks for months over the tax dispute, and Indian Finance Minister P. Chidambaram has said he is confident of a resolution.

Read Also: Vodafone To Invest Billions Of Dollars More: Sibal

On 27 May 2013, Telecom Minister Kapil Sibal had said that notwithstanding its taxation issues, major Vodafone was going to invest billions of dollars in India.

"Foreign investors have all come to me and said that they are very keen to invest more. As we talk, Vodafone has agreed to invest billions of dollars more in the sector itself. Vodafone chief came to me and said we want to expand," Sibal told PTI in an interview.


(Reuters)