Like the faulty General Anti-Avoidance Rules, Finance Minister P Chidambaram now needs to act on the minimum alternate tax (MAT). The special economic zones (SEZs) attracted large-scale foreign investments based on tax exemptions offered under the SEZ Act, 2005. However, after the implementation of MAT, SEZs are struggling to meet the very objective of their formation, i.e. to attract investments. It’s high time the government reconsidered its position on MAT.
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