Walmart assures I-T dept to fulfill tax obligations in Flipkart deal

US retail giant Walmart has assured the Indian income tax department that it will fulfil all tax obligations on its proposed USD 16 billion Flipkart buyout, an official said today.

In May, the I-T department had written to Bentonville-Arkansas-based Walmart, saying that the US company can seek guidance about the tax liability under Section 195 (2) of the I-T Act.

This was after Walmart, on May 9, announced that it will pay approximately USD 16 billion to buy about 77 per cent stake in Flipkart.

Under Section 195 of the Act, anyone making payment to non-residents is required to deduct tax (commonly known as withholding tax).

"Walmart has replied to the letter saying they will fulfill all tax obligations," an official said.