ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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GAAR as a Deterrent to Tax Avoidance

The ongoing global drive against convoluted tax structure, treaty shopping, and the convenient interpretation of loopholes in the law has finally pushed India to join the club of nations having a general anti-avoidance rules regime. This new regime is expected to create a robust deterrent against the practice of camouflaging tax avoidance as a business-driven decision.


The general anti-avoidance rules (GAAR) finally came into operation from 1 April 2017 after much opposition, postponement, and dilution. The long, arduous journey started way back in 1997, when the then Finance Minister P Chidambaram proposed GAAR, but the government failed to introduce it. After the 2008 global financial crisis, when there was an international movement against tax avoidance, GAAR resurfaced in the then proposed direct tax code.

Origin of GAAR

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Published On : 23rd Feb, 2024

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