NEW DELHI: Union Finance Minister Nirmala Sitharaman said on Monday that there is no need to give any explanation on the additional tax burden on foreign portfolio investors (FPi). Nirmala Sitharaman, while presenting the General Budget last week, announced a higher surcharge on the highly wealthy.
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After a meeting of the Central Board of the Reserve Bank of India (RBI) here, the Defence Minister said, "I don't think there is a need to give any explanation at this time." Sitharaman was questioned about the huge FPI sell-off. The anticipation of taxing led to a huge sell-off in the stock market as the FPI's recovery came under heavy pressure.
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Earlier, Central Board of Direct Taxes Chairman Pramod Chandra Moody had said that the Board is examining FPI's concerns on tax surcharge and clarifications will be issued soon. The FPI was oriented towards profit-making, with the apprehension that high-income individuals would have to pay higher taxes due to a surcharge on their income. The government on Friday raised the surcharge on individuals with an annual income of over two crore rupees.