Most of the direct tax changes made in the Budget have been widely debated. However, the least discussed yet crucial issue from a tax policy perspective is the growing incoherence in tax policy relating to 'returns on capital' - an incoherence caused by incremental, piecemeal, issue-by-issue tax policy response over the past few years resting with the changes in distribution tax framework and the new venture capital fund tax regime introduced in Budget 2000.
