No new taxes, Chidambaram tells foreign investors

With just over a month to go for the annual union budget, finance minister P Chidambaram on Tuesday assured foreign investors that there would be no tax hikes, and the government would instead look to increase revenues by simplifying processing and widening the tax base.

"He (the finance minister) suggests the fiscal deficit target will be met, taxes will not be raised - the tax regime will be stable, and while policy will and should be biased towards the poor, the budget will offer a lot," said a statement from Citibank, which hosted the global investors' meet in Hong Kong.

Chidambaram also promised lower fiscal deficit and high economic growth. He sought to allay concerns over the country's economy, saying it did not face the risk of a downgrade of sovereign ratings.

Earlier this week, Moody's Investors Service reaffirmed a stable outlook on India's sovereign ratings at Baa3, the minimum investment grade.

His assertions came a few days after the government modified the controversial general anti-avoidance rules (GAAR) and deferred its implementation by two years to 1 April 2016. The earlier version of GAAR, formulated by Chidambaram's predecessor Pranab Mukherjee, had raised international investors' hackles.

''There is universal acknowledgement that we have handled the GAAR situation fairly effectively and buried the notion that GAAR would be some kind of a monster,'' PTI quoted Chidambaram as saying.