Finance Bill 2018: End of the road for MAT on foreign companies

According to the Finance Bill 2018, this amendment will apply in relation to the assessment year 2001-02 as well as subsequent assessment years

The government has drawn up plans to bring the curtains down on the minimum alternate tax (MAT) on foreign companies. 

An amendment proposed by the Finance Bill 2018 seeks to exempt foreign companies that are engaged in shipping, air transport, oil exploration, and turnkey construction projects from the ambit of the MAT. Brought in with retrospective effect from April 1, 2001, this amendment would help abate pending litigation, said tax experts. Any tax recovered from these companies would, however, have to be refunded.

“The amendment proposed under MAT provisions to exempt foreign companies taxable under the presumptive taxation regime is