Vodafone may have to pay $2 billion to Indian government for Hutchison Essar acquisition

Thu, 01 Nov 2007 18:18:58 +0000

Vodafone could be looking down the barrel of a $2 billion shotgun, held by the Indian government. You see, Vodafone’s recent acquisition of Hutchison Essar, India’s largest mobile operator might be subject to capital gains taxes - and the Bombay High Court just green-lighted an investigation into whether Vodafone is really is liable for the taxes. Vodafone acquired Hutchison Essar for a righteous sum of $11 billion, and the capital gains made from that deal may require $2 billion in taxes. . The company is arguing that the deal was made between offshore entities (Vodafone and Hong Kong-based Hutchison) and is therefore not subject to taxation. Vodafone is what we’d call a big fish in the wireless pond, so we’re sure they’re not going to go belly-up if they have to pony up the $2 billion. But, that’s still a lot of money to just throw away, and you can be sure that Vodafone will be fighting this tax to the end - after all, it Vodafone was just fined in Greece . [Via: Yahoo ] ---Related Articles at IntoMobile:Hutch and Nokia introduce SMS in Indian languagesVodafone denies rumors of $160 billion bid for Verizon CommunicationsHow are Nokia employees in India supposed to work if they can't get to the office?How are Nokia employees in India supposed to work if they can't get to the office?India now has more than 200 [...]

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Vodafone may have to pay $2 billion to Indian government for Hutchison Essar acquisition