Tax recovery from Swedish majors in payment dispute put on hold

The Central Board of Direct Taxes (CBDT) has suspended recovery of tax from Swedish companies whose disputes are being resolved through the Mutual Agreement Procedure (MAP) route, a move that will help in mitigating the hardship faced by such firms operating in India.

According to the CBDT guidance note, the tax demand will be kept in abeyance for two years if the Swedish companies furnish a bank guarantee of the disputed amount to the income tax authorities in India. Around a dozen large Swedish companies including H&M, Volvo, Oriflame Holding, are operating in India and several of them are locked in