Vodafone indicated that a settlement is possible in its long-running quarrel with the Indian government over its tax bill in the country.
Analjit Singh, Vodafone India's non-executive chairman, held talks with the country's finance minister last week and indicated afterwards that the operator was open to negotiations, according to Bloomberg India.
"We have made our public position very clear that Vodafone is completely ready to discuss the matter," Singh said, according to Telecom Tiger. "Vodafone is not a company, [that is] confrontationist [or] controversial. This is not Vodafone's business, its business is telecom."
Critically, he added that Vodafone was open to discussion over the tax issues and would explore new options to pay the government if interest and any penalty were waived.
The tax due by Vodafone is said to be $1.4 billion (£862 million), while interest and penalties amount to $2.2 billion, reports LightReading India. This tax problem arose following Vodafone's acquisition of Hutchison Whampoa's stake in Hutchison Essar in 2007 through a deal via the Cayman Islands.
Disagreement over the taxation of the deal has become immersed in politics since the government ruled in Vodafone's favour earlier this year over any tax demands related to the Hutchison Essar deal. Since then, the government has amended the law retrospectively to tax cross-border transactions dating from April 1962. The government, however, commissioned a review of this back-dating within days of finance minister Chidambaram taking charge in August this year, according to LiveMint.
The UK company is said to want a final resolution to its Indian tax problems by November. Vodafone CFO Andy Halford said recently the company may set aside $2.2 billion to cover legal risks relating to the tax dispute.
- see this Bloomberg India article
- see this Telecom Tiger article
- see this Lightreading India article
- see this LiveMint article
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