Virtually every high-tax nation has one or several symbiotic tax
havens that reduce damage of excessive taxation. The US uses the
Bahamas and Bermuda, the UK has Ireland, Channel Islands and the
Isle of Mann, Russians depend on Cyprus and India uses mainly
Mauritius. For thirty years the African island nation has had a
very attractive tax treaty based on cultural and religious ties
with India. Mauritius, with a population of 1.3m, accounted for 42
per cent of India's foreign direct investment from 2000 to
2011, worth US$55bn according to Delhi's ministry of
commerce.
But when India's supreme court ruled in favour of Vodafone
back in January, authorities have proven to be sore-losers trashing
about wildly and blindly one dubious legislative proposal after
another. Some of the more wacky ideas included amending tax-laws
retrospectively and creating overly vague General Anti-Avoidance
Rules (GAAR).
