New Delhi, Oct 21 (IANS): The Indian government has set up a panel headed by finance minister's advisor Parthasarthy Shome to review the country's tax policies and laws.

The panel that has two full-time and four part-time members, held its first meeting here Monday.

According to a statement released by the finance ministry after the meeting, the panel called “Tax Administration Reform Commission” will review the application of “tax policies and tax laws in India in the context of global best practices and to recommend measures for reforms required in tax administration to enhance its effectiveness and efficiency”.

The term of the commission is 18 months and it will work as an advisory body to the finance ministry. "The commission will give its first report within six months and thereafter submit periodic reports after every three months," the statement said.

The formation of the new body is important in view of the lingering tax dispute with some major firms notably UK-based telecom giant Vodafone.

As per the terms of reference of the commission, it will "review the existing mechanism and recommend measures for deepening and widening of tax base and taxpayer base."