India's 2015-16 Budget seeks to rationalise laws, attempts to boost investors' confidence, increases social infrastructure and job opportunities, a corporate tax expert at a leading international consultancy has said.
The thrust of the Budget measures has been on accelerating growth, creating an investor friendly environment and emphasising on the 'Make in India' initiative which were the key agenda points of their electoral mandate, India Desk Leader at PricewaterhouseCooper (PwC) here, Abhijit Ghosh said yesterday..
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"There have been numerous policy and tax amendments announced in the current Budget in support of overseas investors to attract Foreign Direct Investment (FDI) into India," he said.
Some of the key policy announcements include Appointment of Expert Committee to evaluate proposition of eliminating multiple prior permissions with a pre-existing regulatory mechanism and putting in place a draft legislation to improve ease of doing business in India by overseas companies.
The budget also has a proposal to provide composite caps for foreign investment vis-a-vis differentiation between types of foreign investments - FDI, Foreign Institutional Investments and others.
He also welcomed the proposal to allow foreign investment in Alternate Investment Funds.
On the tax front, Ghosh noted the importance of proposal to reduce corporate tax rate of domestic companies from 30 per cent to 25 per cent over a period of four years and reduction in tax rates from 25 per cent to 10 per cent on Royalty and Fees for Technical Services income earned by non-residents.
Deferral of General Anti-Avoidance Rule (GAAR) by a period of two years and clarifying that GAAR would apply only prospectively was also good news for foreign corporations.
He noted the positive steps to promote India as a fund manager destination as the budget announced that mere presence of fund managers in India shall not constitute business connection for offshore fund in India.
"Overall, Budget 2015 shows the Government's commitment towards increasing competitiveness of the Indian economy while managing the expectation of domestic corporates and the common man too.! The real test lies in how efficiently the new government would be able to execute the ambitious proposals brought forth in Budget 2015," he said.