Prime Minister Narendra Modi addressing the India-France Business Summit in Chandigarh on Sunday. (PTI photo)
Prime Minister Narendra Modi today announced that the controversial retrospective taxation is a thing of the past and the chapter will never be opened again in India, a statement aimed at addressing the concerns of foreign investors over predictability in the tax regime.
Addressing the business leaders of France and India in Chandigarh in presence of French President Francois Hollande, PM Modi said his government wants to ensure that foreign investors are clear about tax systems that will prevail in India over the next 15 years.
"I am for stable governance and predictable taxation system. The government is taking various steps to ensure this stability. This government is known for stable and predictable tax regime," he said.
Referring to plans of introducing retrospective tax in 2012 through amendments in the Income Tax Act, a step which had led to an outcry and anxiety among the investors, particularly the foreign one, he said, "retrospective tax is a matter of past."
"That chapter will not be opened again. We are ensuring that neither this government nor the future governments can open this chapter," he said.
PM Modi and President Hollande attended a CEO's forum and a business summit in Chandigarh.
"Whosoever makes investment in the country should know about the taxation system in the country over the next five years, 10 years, 15 years," he said.
The French President, who began his three-day visit from Chandigarh today, is accompanied by a large delegation of CEOs.
Inviting French companies, especially those in the defence sector to manufacture in India and take advantage of low costs involved, the Prime Minister said India provides huge business opportunity for them.
"India wants to enter the field of defence manufacturing. I assure French companies present here, especially in the field of defence manufacturing that we can do a lot in the area of defence manufacturing," the PM said.
"We are working towards improving quality of life. We are working on good governance. These are the two initiatives that world is attracted towards," PM Modi said.