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Finance Minister Nirmala Sitharaman, has announced a tax holiday for foreign aircraft leasing companies in the Union Budget of 2021.
On February 1, Sitharaman said, “The government is committed to make the International Financial Services Centre (IFSC) in GIFT City a global financial hub.”
She said that there will be a tax holiday for capital gains for aircraft leasing companies. Along with this, she added that there will be a “tax exemption for aircraft lease rentals paid to foreign lessors.”
Currently, most of the aircraft leasing companies are based out of Ireland, Dubai and Hong Kong. This move, according to industry watchers, will allow investment in this sector in India.
The current customs duty on components or parts, including engines, for manufacture of aircrafts by Public Sector Units of Ministry of Defence is 2.5 per cent, now it has been reduced to nil for the coming fiscal.
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