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India: Amendments to Finance Bill, 2018; approved by lower house

India's Finance Bill, 2018

The lower house (Lok Sabha) of parliament on 14 March 2018 passed the Finance Bill, 2018, with certain changes adopted to the tax proposals.

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The changes approved by the lower house concern:

  • The rules for “significant economic presence” in India, to clarify that transactions or activities constitute a significant economic presence whether or not the agreement for such transactions or activities was contracted or entered into India
  • Deductions for “start-ups” available for three consecutive years of assessment if turnover does not exceed a threshold amount (INR 25 crore)
  • Measures concerning the taxation of long-term capital gains to apply for transfers of equity shares in a company, units of an equity-oriented mutual fund or units of a business trust
  • Provisions concerning the conversion of inventory into capital assets to reflect an amended definition of “actual cost”
  • Withdrawal of an exemption for investments in specified bonds if the bonds are issued on or after 1 April 2016 and are transferred or redeemed within five years
  • An amended definition of “equity-oriented fund”
  • Amended rules for a PAN (permanent account number) of non-individual resident taxpayers
  • Revised rules for valuation of securities held by a scheduled bank or public financial institution

 

Read a March 2018 report [PDF 583 KB] prepared by the KPMG member firm in India

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