Tax cloud over IFSC units: DDT waiver on what is paid from current income

DDT waiver only on what is paid from current income, not accumulated profit; experts say Centre should clarify

There is concern that a portion of the dividend to be declared by companies operating out of the International Financial Services Centre (IFSC) could come under the tax net.

The central government had announced various tax sops for new businesses engaging in financial services at IFSC, set up at GIFT City in Gujarat. Among these, waiver of dividend distribution tax (DDT) on profits distributed by IFSC companies was considered a major relief, as it would help them to repatriate profits without additional cost to the business.

However, the waiver has been provided for dividend distributions made by IFSC companies only from current