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Govt mulls tax holiday for companies making new investments in India

The finance ministry is considering a commerce ministry proposal on this, according to a Bloomberg report

Coronavirus | Tax holiday | Indian Economy

BS Web Team  |  New Delhi 

fiscal deficit, economy, illustration
According to another plan, a four-year tax holiday could be given to companies investing over $100 million in labour-intensive sectors

Even as the Narendra Modi-led central government looks at measures to support the economy amid a global crisis, the Union commerce and ministry could be planning a for companies that bring new investments, suggests a Bloomberg report citing unnamed sources.

The is said to be evaluating the proposed of 10 years, which might apply to companies making more than $500 million worth of new investments. According to Bloomberg, the companies will need to start operations within three years from June 1 and cover sectors like medical devices, electronics, telecom equipment and capital goods to be able to avail of the benefits.

The report also speaks of another plan, where a four-year would be given to companies investing upwards of $100 million in labour-intensive sectors like food processing, textiles, leather and footwear.

Additionally, a lower corporation tax is said to be planned for next six years, at the rate of 10 per cent. The has yet to take a final decision on this, says the report.

First Published: Tue, May 12 2020. 16:12 IST