All foreign firms exempt from India’s minimum alternate tax, government says

India’s Central Board of Direct Taxes announced September 24 that it will not impose minimum alternative tax (MAT) on companies that do not have have a permanent establishment or a place of business in India.

The decision broadens a September 1 announcement made by Finance Minister Arun Jaitley that foreign institutional and portfolio investors without a PE or place of business would be considered exempt from the tax. Jaitley’s decision was based on the conclusions of a report prepared by a committee headed by retired judge A.P. Shah, constituted last May for the purpose of analyzing the issue.

Foreign firms have been putting intense pressure on the Indian goverment to halt assessment of MAT on their income, which began for the first time last winter.

See:

• Press Release

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