Bharti Airtel files petition against taxman at Delhi HC:
Yet another battle may be brewing between a telecom player and the taxman. Bharti Airtel has filed a petition against the tax department's claim of Rs 1,067 crore.
What is the Taxman's claim:
When anyone travels abroad there is a certain amount of fee that your service provider makes to its international partners to ensure that you have services on a roaming basis. So, the payments which Bharti Airtel has been making since 2007 to 2011 to its international partners have been taxed by the tax department. The demand notice that was given to Bharti Airtel in January pertains to these payments.
If one breaks up the claim of Rs 1067 crore, sources says that for 2007-2008 they had asked for Rs 202 crore, for 2008-2009 it was Rs 329 crore, for 2009-2010 it was Rs 303 crore and 2010-2011 it was around Rs 221 crore
Bharti Airtel's action:
Bharti Airtel is looking at fighting this and has filed a petition in the Delhi High Court. The petition outlines that they have adhered to all tax rules and the demand on tax for international roaming payment is not valid.
This is an industry wide case, if the taxman is filing a case and fighting against Bharti Airtel, some other players might also be taxed. Bharti Airtel would take this up and other telecom players might be looking at taking it up if there is any kind of tax claim case against them.
Source:www.moneycontrol.com
At $695 b, China’s external debt hits 27-year high in 2011:
China’s external debt totalled a whopping $695 billion last year, highest in 27 years, adding to concerns that it might undermine the country’s fiscal position at a time when its economy has slowed down due to declining exports.
The external debt rose by $146 billion, or nearly 27 per cent from 2010, data released by the State Administration of Foreign Exchange (SAFE) said.
The proportion of short-term external debt to the total also climbed to a record high of 72 per cent as of December 31, in contrast to 68 per cent in 2010 and 60 per cent in 2009, SAFE data said.
But the year-on-year increase in short-term debt moderated. As of 2011 end, outstanding short-term debt stood at $500.9 billion, up 33 per cent. The growth rate was nearly 12 percentage points lower than in 2010.
The jump in foreign debt shows that China, which lends more than it borrows, is borrowing more from overseas to hedge against the devaluation of its foreign exchange reserves, analysts said.
Meanwhile, enterprises on the Chinese mainland have resorted to borrowing from overseas due to financing difficulties at home, they added.
As the yuan has strengthened against other currencies, the value of China’s foreign exchange reserves has shrunk, Li Jian, a research fellow from the Chinese Academy of International Trade and Economic Cooperation from the Ministry of Commerce, said.
According to SAFE, the yuan has risen 13.69 per cent against the US dollar since the beginning of 2008.
The yuan appreciation also had an adverse impact on China’s foreign exchange reserves of $3.20 trillion, highest in the world. As a result, the value of the Chinese government’s dollar-denominated assets has fallen, Li argued.
Borrowing in dollars allow the Government to offset some of those losses because it would effectively have to pay less when the loans come due if the yuan continues to strengthen, Li told state run Global Times.
Also, the Chinese business enterprises have become more reliant on borrowing from abroad due to soaring costs of domestic financing, Zhang Yugui, dean of the College of International Finance and Trade at Shanghai International Studies University said.
Source: www.thehindubusinessline.com
Yet another battle may be brewing between a telecom player and the taxman. Bharti Airtel has filed a petition against the tax department's claim of Rs 1,067 crore.
What is the Taxman's claim:
When anyone travels abroad there is a certain amount of fee that your service provider makes to its international partners to ensure that you have services on a roaming basis. So, the payments which Bharti Airtel has been making since 2007 to 2011 to its international partners have been taxed by the tax department. The demand notice that was given to Bharti Airtel in January pertains to these payments.
If one breaks up the claim of Rs 1067 crore, sources says that for 2007-2008 they had asked for Rs 202 crore, for 2008-2009 it was Rs 329 crore, for 2009-2010 it was Rs 303 crore and 2010-2011 it was around Rs 221 crore
Bharti Airtel's action:
Bharti Airtel is looking at fighting this and has filed a petition in the Delhi High Court. The petition outlines that they have adhered to all tax rules and the demand on tax for international roaming payment is not valid.
This is an industry wide case, if the taxman is filing a case and fighting against Bharti Airtel, some other players might also be taxed. Bharti Airtel would take this up and other telecom players might be looking at taking it up if there is any kind of tax claim case against them.
Source:www.moneycontrol.com
At $695 b, China’s external debt hits 27-year high in 2011:
China’s external debt totalled a whopping $695 billion last year, highest in 27 years, adding to concerns that it might undermine the country’s fiscal position at a time when its economy has slowed down due to declining exports.
The external debt rose by $146 billion, or nearly 27 per cent from 2010, data released by the State Administration of Foreign Exchange (SAFE) said.
The proportion of short-term external debt to the total also climbed to a record high of 72 per cent as of December 31, in contrast to 68 per cent in 2010 and 60 per cent in 2009, SAFE data said.
But the year-on-year increase in short-term debt moderated. As of 2011 end, outstanding short-term debt stood at $500.9 billion, up 33 per cent. The growth rate was nearly 12 percentage points lower than in 2010.
The jump in foreign debt shows that China, which lends more than it borrows, is borrowing more from overseas to hedge against the devaluation of its foreign exchange reserves, analysts said.
Meanwhile, enterprises on the Chinese mainland have resorted to borrowing from overseas due to financing difficulties at home, they added.
As the yuan has strengthened against other currencies, the value of China’s foreign exchange reserves has shrunk, Li Jian, a research fellow from the Chinese Academy of International Trade and Economic Cooperation from the Ministry of Commerce, said.
According to SAFE, the yuan has risen 13.69 per cent against the US dollar since the beginning of 2008.
The yuan appreciation also had an adverse impact on China’s foreign exchange reserves of $3.20 trillion, highest in the world. As a result, the value of the Chinese government’s dollar-denominated assets has fallen, Li argued.
Borrowing in dollars allow the Government to offset some of those losses because it would effectively have to pay less when the loans come due if the yuan continues to strengthen, Li told state run Global Times.
Also, the Chinese business enterprises have become more reliant on borrowing from abroad due to soaring costs of domestic financing, Zhang Yugui, dean of the College of International Finance and Trade at Shanghai International Studies University said.
Source: www.thehindubusinessline.com
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