Finance minister hopeful of resolution of Vodafone tax case

Finance minister hopeful of resolution of Vodafone tax caseIndia's union Finance Minister P. Chidambaram has said that the case involving tax dues of telecom giant, Vodafone and the country's tax authorities is likely to be resolved as the two sides continue to hold discussions on the matter.

Chidambaram said, "I'm sure some way will emerge out of these discussions. I will be very happy if we could find a resolution to the issue, put it behind us and move on. I think Vodafone is of the same view, so both government and Vodafone are keen to resolve the matter and I am confident we can resolve it."

India apex court, the Supreme Court of India had dismissed the government's demand for $2.2 billion in taxes from Vodafone for its acquisition of Hutchison Whampoa Ltd's India operations in 2007. The victory had ended the case but the company has been asked to pay taxes following the implementation of some changes to the law relating to retrospective laws.

Vodafone has said that the changes proposed by the government aims to apply tax liabilities on a retrospective basis, something that did not exist in the India law at the time if the acquisition of Hutchison's share in the India based telecom operations. The company argues that the changes would violate international legal protections that were granted to Vodafone and other international investors in India.

Chidambaram said that the case is a one-off case in the country and expressed hope that the issue could soon be resolved.