VK Goel
The revenue department will not act on demands for minimum alternate tax (MAT) it has already slapped on foreign portfolio investors (FPIs) nor will it make any fresh MAT claims, the government said on Monday, offering relief to FPIs in an ongoing dispute that has rattled the markets.
The embargo will prevail until a committee headed by Law Commission chairman A.P. Shah submits its report to the government on the applicability of MAT on foreign investors, an official circular issued by the tax department said.
Not only will this provide a respite to FPIs and long-term investors like private equity and venture capital funds, it also signals a climbdown by the revenue department.