Which of the following statements is/are correct with reference to the retrospective tax?
A. It means to pay tax for goods and services purchased in the past or income earned in the past.
B. India retrospectively amended its taxation laws through the Finance Act of 2012.
C. Both A & B
D. None of these
Explanation:
Cairn Energy has brought a lawsuit in a US court that potentially can lead to seizing of Air India’s overseas assets such as airplanes to recover USD 1.72 billion from the Indian government which an international arbitration tribunal had awarded after overturning levy of retrospective taxes. The term retrospective means to look back on something that has occurred in the past. So, the term retrospective tax means to pay tax for goods and services purchased in the past or income earned in the past. India retrospectively amended its taxation laws through the Finance Act of 2012, permitting tax authorities to reopen and/or investigate transactions from 2006 for evasion of capital gains tax.
