Aug. 30 - Special economic zone incentives will be exempted from the new direct tax code (DTC) until 2014 although there is a proposed 20 percent minimum alternative tax based on a version approved by the Cabinet last Thursday.
Despite the assurance, investors are still nervous about the changes and developers are unsure whether zones will attract enough investors despite the changes made to the DTC. The bill may still undergo revisions when it reaches Parliament for approval.
Aug. 27 - India’s Consumer Affairs Ministry is recommending that 49 percent foreign direct investment be allowed in the multi-retail industry with an emphasis on developing back-end operations.
The ministry said that more foreign investment should be allowed on the condition that a model law be in place to help shield small businesses. Moreover, the majority of foreign investment in multi-brand retail should focus on improving back-end infrastructure, in addition to agricultural processing and logistics. Read the rest of this entry »
Aug. 19 - One of India’s top ranking business schools said in a report that the government should give local businesses five years to develop before opening multi-brand retail to foreign direct investment.
The report made by Birla Institute of Management Technology (BIMTECH) said “…a breathing space of five years till 2015 should be given to the unorganized retail sector so as to enable this crucial sector to re-orient its strategy and be competent to face competition from foreign investment.” Read the rest of this entry »
Aug. 12 - The Reserve Bank of India has released a discussion paper that talks about possibly opening the private banking sector to new players.
“The RBI clearly expresses its intent to expand the banking reach in the country while focusing on maintaining financial stability,” said CII director-general Chandrajit Banerjee. This will make bank capital requirements and intent now open to other competition. Read the rest of this entry »
Aug. 4 – A recent Supreme Court decision has ruled that payment made in kind will also be subject to taxes in India.
This was based on an appeal made in court by local company Kanchanganga Sea Foods regarding its payment in kind to Hong Kong-based company Eastwide Shipping for lending the use of vessels and personnel. The Indian company gave Eastwide 85 percent of fish catch as payment. It was able to get its foreign partner official permission to fish in an Indian economic zone. Read the rest of this entry »
Aug. 2 - India’s Central Board of Direct Taxes announced it would extend income tax return filing from July 31 to August 4.
All returns, whether done electronically or not, as long as it is given on or before August 4 will be considered on time. The extension was announced after reports that the e-filing computer system encountered technical difficulties and stormy weather prevented some taxpayers from filing their returns. Read the rest of this entry »
Jul. 20 - Special economic zone exports in India increased by 67 percent to Rs. 587.5 billion for the first quarter of the financial year compared to the same period last year.
Top special economic zone exports included information technology, IT hardware, petroleum, engineering, leather and garments. Exports from the zones have continued to show strong growth. From 2009 to 2010, SEZ exports increased by more than 122 percent. Read the rest of this entry »
Jul. 9 - The Delhi High Court has decided in favor of overseas parent company Suzuki Motor Corp. (SMC) saying the company should not pay Maruti Suzuki India (MSIL) for increasing brand recognition for Suzuki via marketing campaigns contrary to a previous decision made by tax authorities.
The court’s decision applies to the assessment year 2004-05 and will serve as an example to clarify rules on transfer pricing issues related to branding for foreign investors. Read the rest of this entry »
Jul. 7 - The Commerce and Industry Ministry released a discussion paper on Tuesday that considers removing barriers hindering foreign investment in the retail sector.
Currently, only 51 percent of foreign direct investment is allowed for single-brand retail while multi-brand retail is limited to cash-and-carry branches. It is now being proposed that large-scale investment in the retail section may help ease the country’s rising inflation rates and make supply chains more efficient. Read the rest of this entry »
Jun. 29 – India is setting up a new committee that will evaluate the sensitive sector investment plans of local companies with foreign shareholders to confirm if a firm is truly Indian-owned.
The panel will study plans to invest in sensitive sectors such as telecommunications, aviation and single-brand retail looking at a company’s shareholding pattern and agreements. Read the rest of this entry »
Dezan Shira & Associates provide a range of services for companies looking to undertake foreign direct investment into Asia, These include corporate establishment, accounting, tax, payroll, audit and due diligence. To learn more about the firm,
please contact one of our specialists at india@dezshira.com, download our corporate brochure or visit at us www.dezshira.com
