While I-T overseas units are currently located in Singapore and Mauritius, the new units would be set up in US, Britain, the Netherlands, Japan, Cyprus, Germany, France and the UAE
The government has decided to set up income tax (I-T) overseas units in eight more countries, including the US and Britain, to help exchange tax-related information, reports PTI.
This is likely to be announced by finance minister Pranab Mukherjee on Wednesday at a two-day annual conference of chief commissioners and director generals of income tax, a key source said. Currently, income tax overseas units are located in Singapore and Mauritius.
The overseas units would also be established in the Netherlands, Japan, Cyprus, Germany, France and the UAE.
"The I-T overseas units would be created to streamline exchange of information with treaty partners," source added.
The conference would discuss renegotiation of double taxation avoidance agreement (DTAA) with various countries in the light of the requirement to have effective exchange of information, particularly bank-related agreements.
The government has approached 65 countries for DTAA renegotiation. With Switzerland, it has recently completed its renegotiation.
The issue of renegotiation of tax treaties assumes importance, since the matter of money allegedly stashed away by Indians in foreign banks became a scoring point in the past general elections.
The conference will also look for ways to meet the direct tax collection target of Rs4.30 lakh crore despite several concessions declared in the budget. "The collection target becomes stiff in view of relief and concessions announced in budget 2010 involving direct tax outgo of about Rs26,000 crore," an official statement said.
The budget estimates 2010-11 have pegged direct tax collections at Rs4,30,000 crore, a growth of 16.2% over the budget estimates for 2009-10. "The conference will deliberate strategies to achieve the tax collection target," the statement said.
Improving taxpayer services will be another area of concern, the department said. The income tax department has taken several steps to improve the delivery of taxpayer services by introducing schemes such as e-filing of returns and e-payment of taxes. To make the tax administration more efficient and effective, the meet will deliberate upon organisational changes including augmenting manpower and delegation of financial powers.
The conference will be held at a time when the finance ministry is likely to issue amended draft of direct taxes code soon and may address the issue of taxing long-term savings at the time of withdrawal among other matters.
The company is looking at acquiring a copper mine in Australia and has plans to revive the defunct company Mt Gordon Copper Operations
Asia's largest aluminium producer, Hindalco, is eyeing a copper mine in Australia. "Our objective is to get 40% of our need for copper concentrates from our own mines. We are falling short of that number," said Debu Bhattacharya, managing director, Hindalco Industries.
Mr Bhattacharya declined to divulge further details and said that the company is currently evaluating the options.
Aditya Birla Minerals Ltd, the Australian subsidiary of Hindalco, is also planning to re-open the Mt Gordon Copper Operations (BMGO). Mt Gordon was shut in January 2009 due to declining copper prices. MGO is currently under maintenance. It produced 57,093 metric tonnes of copper in FY10.
Meanwhile, Hindalco's net profit jumped 711% at Rs3,925 for the year ended March 2010 from Rs484 crore in FY09. The stock fell 5.81% in today's trading session at Rs132.20 from Rs140.35 (yesterday's close) on the Bombay Stock Exchange (BSE).
The BSE metal index has dropped 20% from 17,321.12 to 13,888.55 (as on 8 June 2010) since May 2010. Hindalco's stock has slipped 14% this year.
The company produced 3,32,000 kilo tonnes (KT) of copper in FY09 and plans to ramp up the production to 3,37,000KT next fiscal. The company's copper business revenue increased by 13% to Rs12,575 crore and earnings before interest, tax and depreciation (EBITD) jumped from Rs374 crore to Rs1,003 crore. Hindalco's copper sales stood at Rs12,575 crore in FY10 (up 13% from Rs11,098 crore in FY09).
The company's copper business, which benefited from higher contracted treatment charges and refining charges, lost Rs750 crore on lower by-product credit, such as sulphuric acid. The three-month copper contract prices have dropped 24% from $8 per pound in April 2010 to $6.10 per pound (as on 8 June 2010) on the LME. Mr Bhattacharya said that he is not pessimistic about the future trend in aluminium prices and said that Europe should not be looked at as the only market.
Hindalco reported net sales of Rs19,536 crore for the year ended March 2010. The company's aluminium revenue fell 11% at Rs48,091 crore due to prices and subdued demand in the first half of FY09. The three-month aluminium contract has dropped 24% since its peak in April 2010 of $2300/tonne to $1750/tonne as on 8 June 2010 on the LME.
The government said today that the issue between the regulators will be resolved soon
The government today said it is confident of resolving the row between insurance regulator Insurance Regulatory Development Authority (IRDA) and market regulator Securities and Exchange Board of India (SEBI) over who should administer Unit-linked Insurance Plans (ULIPs).
"We will resolve this issue soon," finance minister Pranab Mukherjee said at the launch of the Insurance Institute of India in Mumbai today. The six-storeyed building is equipped with modern amenities and hostel facilities for residential programmes. The entity will be an educational service provider for all insurers in the country.
The spat between SEBI and IRDA broke out in early April when the capital market regulator banned 14 life insurance companies from issuing ULIPs, which invest heavily in stocks and bonds. A day after, IRDA asked life insurers to ignore the order.
As the impasse continued, the finance ministry directed the regulators to jointly seek a legally-binding order from an appropriate court over jurisdiction of ULIPs.
The standoff between the regulators became a subject of ridicule by Deepak Parekh, a key adviser to the government, who said that the row had made India a "laughing stock."
He had also hit out at the government for allowing the capital markets and insurance regulators to go to the courts, saying a rethink on their fight over jurisdiction on ULIPs would lead to a solution.
SEBI and IRDA are yet to see eye-to-eye on regulating ULIPs.
The market watchdog has filed a petition in the Supreme Court for transferring various petitions against ULIPs. The issue of jurisdiction is obliquely referred to in these petitions.
"I understand that IRDA has taken some very positive steps in respect of regulations of ULIPs which are in the interest of both the insurance industry as also the policyholders," Mr Mukherjee said.
Some of these measures like cap on charges, extending the minimum term of the policy to 5 years, bringing the concept of compulsory annuitisation in pension policies and the proposal of fixing the maximum limits of surrender charges have brought in the much-needed reforms in ULIP products, he said.
"I am sure that the insurance industry and IRDA would continue to bring in these reforms so that the interest of all the stakeholders is secured," he said.
In order to put more money in the hands of investors, IRDA recently said that insurers cannot charge fee on surrender of a unit-linked insurance policy after five years.
Insurance companies used to charge a nominal fee to customers to withdraw their unit-linked policies even after expiry of lock-in period. However, policies withdrawn during the lock-in compulsorily attract a high surrender charge.
Putting stress on spreading awareness about insurance, Mr Mukherjee said that one of the important challenges is to generate the required level of awareness about the benefits of insurance to people-particularly those living in semi-urban and rural areas.
"It should be our endeavour to take all necessary steps to ensure the reach of insurance to (the) masses," he said.
"I also take this opportunity to commend the role of the intermediaries specially the agents in the insurance industry who have contributed in ensuring that the insurance products reach every nook and corner of the country. With a force of around 30 lakh agents, it is a matter of pride that (the) insurance industry is perhaps the only financial services arm that reaches out to almost all the villages in this country. This is also borne out by the fact that 25% of the life policies i.e., approximately 1.5 crore policies every year are sold in the rural areas," Mr Mukherjee said.
When Moneylife asked IRDA chairman, J Hari Narayan if the ULIP issue would be resolved out of court, he said, "The finance minister has said that the matter will be resolved."