Thursday, April 14, 2011

Vodafone Responds to the $2.5 Billion Indian Tax Row

I am very familiar with Vodafone in that it has become one of the hottest mobile service providers in all of India. However, Vodafone recently bought a large share in a mobile phone provider in India and is looking to become more prominent around India. The big problem with this is that Vodafone is being hit with a large amount of taxes.

A tax row of $2.5 billion will imposed on Vodafone after its purchase of a mobile phone firm in India. This is a big penalty that Vodafone is very upset about.

The big response

Vodafone has announced that it is refusing to go along with the penalty that the Indian tax services have imposed onto it. Vodafone is arguing that this tax row is too large and that it will keep foreign parties from wanting to invest in the services that Vodafone has to offer.

As a result, Vodafone is filing a petition to the national Supreme Court. This is being used in the hopes of potentially getting rid of a good deal of the penalty. It is not clear if this will work all the way but the group is hoping to get this under control as soon as possible.

Why is this important?

This is an important dispute because it covers how India has become a more prominent country in the world of technology. This may be used to influence the way how people who are going to invest in the country will be doing so over time because it relates to how tax money is being used in India for charging money on corporations that are critical to the national economy.

What will happen?

It is not clear as to what can happen in the event that the lawsuit goes far or stops soon. There is a potential that this could hurt India’s foreign investors to where they will pull out of the area. However, it is clear that this could be used to create an argument to try and get people to control what they are doing to where they will want to deal with different kinds of purchases and procedures instead of trying to make any future purchases for any needs.

The tax code in India is also being disputed. This could change the way how the country deals with its taxes in the near future. After all, India has grown to where it is more prominent in the global economy and needs to work with different standards to help protect all sorts of people who want to get into different investments around the country.

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