India said to be asking banks for at least 20b rupees in back taxes

New Delhi

INDIA plans to issue demands for back taxes amounting to a total of at least 20 billion rupees (S$420 million) from about a dozen banks as part of a government investigation into services levies, according to two officials with direct knowledge of the matter.

The government will issue orders for payment as early as April, the officials said, asking not to be identified because the information isn't public. The total amount of tax demands may reach more than 100 billion rupees through 2016 as the government probe widens to include all of India's roughly 100 lenders, the officials said.

Authorities are demanding that India's banks pay taxes on services they claim were rendered to customers who maintained accounts above minimum balances, which qualified them for perks like unlimited transactions without fees, free ATM cash withdrawals and complimentary debit cards, the officials said. The government is calculating the amount owed based on the rates that banks charged customers who didn…