Rbi Eases Forex Norms For Remittances
The Reserve Bank of India (RBI) has relaxed the foreign exchange guidelines in the areas of sundry remittances towards cost of services, basic travel quota, remittance of income on investments and interest on non-repatriable deposits held in India.
In a circular dated February 17, 1997, RBI has decided to delegate powers to authorised dealers to allow remittance of net amount of commission to overseas agents and also reimburse charges incurred by them towards postage, telex etc.
This would, however, be subject to the condition that the total amount reimbursed should not exceed 30 per cent of the gross tariff earned in foreign exchange by the Indian newspapers and periodicals.
Authorised forex dealers would have to verify the relative agreements, bank certificates showing repatriation of advertisement tariff earned in foreign exchange and a no objection certificate or income tax clearance certificate from the income tax authorities before allowing such remittances.
In certain cases, these agreements may provide for deduction of the amount of commission or other charges from the gross amount of the bills raised by the Indian newspapers and periodicals and only the balance amount will be remittable to India.
In such cases, approval of the RBI will not be necessary if the total deductions as stated above do not exceed 30 per cent of the gross tariff earned and at least 70 per cent of the tariff is repatriated to India through normal banking channels and the tax liability of the non-resident is met by the Indian company concerned.
The RBI has also decided to raise the limit from $10,000 to $25,000 for the purpose of sundry remittances.
Authorised dealers have been permitted to include subscriptions to newspapers and magazines under sundry remittances.
Applications from foreign nationals permanently resident in India for the purpose of basic travel quota (BTQ) are currently required to be referred to RBI for permission to release foreign exchange.
The RBI has now decided to allow authorised forex dealers and full-fledged money changers to release foreign exchange to foreign nationals permanently resident in India provided they are not availing of other remittance facilities.
Authorised dealers and full-fledged money changers should then obtain an undertaking from the applicant foreign national on the application itself that he is permanently resident in India and is not availing any facilities for remittance abroad of his income or savings.
The Reserve Bank of India has also permitted authorised dealers to allow remittances of income earned by non-resident Indians and overseas corporate bodies on their investments and deposits as and when desired provided the applicant is able to produce a no-objection certificate and income-tax clearance certificate from the income-tax authorities for each remittance sought.
Non-resident Indians and Overseas Corporate Bodies could earlier remit their income on investments and deposits made on non-repatriation basis in one lumpsum or in two installments if so desired by the applicant.