Loss in oil tax not to impact finances: FM

As regards the impact of the decision to cut duties on the fiscal deficit, he said the shortfall would be made good by buoyancy in tax collection and improved compliance.

“I do not think so because this was the conscious decision... About Rs 49,000 crore will be the shortfall in the duty. I think it would be possible for us to make it up through buoyancy and by better compliance,” Mukherjee told PTI.

On the issue of tax treaty with Mauritius, Mukherjee said the government is negotiating changes in a tax treaty with Mauritius, the country which accounts for the maximum foreign investment in India.

“So far as Mauritius is concerned, we are having discussions with them for amendment of the avoidance of double taxation agreement. Talks are going on,” he said when asked whether the government is looking at the possibility of imposing levies on inflows from tax havens.