FICCI - Obama's tax policy: 'a retrograde step'

06 May '09

2 min read

Reacting to the statement made by President Barack Obama on ending tax breaks for US companies that invest and create jobs abroad, Mr. Harsh Pati Singhania, President, FICCI said “Such a move if implemented would constrain US companies as they move ahead to benefit from the advantages with regard to production, distribution and marketing offered in different parts of the world.” “In this era of globalization, a much more meaningful measure would have been to evolve a consensus on harmonizing the national taxation systems,” he added.

With the developments taking place in the fields of communication and transportation, the world is becoming a borderless entity. In such a situation, taking measures that force companies to restrict their economic activities in one region and not in the other is a retrograde step.

“In any case several US corporations have come and set up operations in India because of the several advantages our country has to offer. Our large and growing market, large pool of skilled manpower, reasonable labour costs make investing in India an attractive proposition. While this move would certainly have some impact on US investments abroad and into India, in the long run this would only run counter to the interest of US corporations desirous of cost efficient operations across the globe,” said Mr. Singhania.

Federation of Indian Chambers of Commerce and Industry

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