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June 4 | Updated on July 12, 2021

OCBs: Automatic approval norms in for changes

The automatic approval regime for overseas commercial borrowings up to $50 million is set to undergo changes, marked by more restrictions, following reservations expressed by the Finance Ministry regarding the misuse of this facility. Corporates are now allowed to borrow up to $50 million abroad on an automatic approval basis. This facility is also available for refinancing of existing external commercial borrowings.

Exporters to lose income-tax holiday

Exporters enjoying income-tax holidays are in for some disappointment with the recent transfer pricing legislation. The Government has now made it clear that these enterprises would not be eligible for tax holidays on any transfer pricing adjustments made by the tax authorities. Currently, various tax holidays are available to export-based enterprises and certain infrastructural undertakings under Section 10A.10B, 80HHC to 80HHF, 80IA of the Income-Tax Act, 1961. Section 10A, for' instance, allows tax exemption on income from export of goods and computer software for units located hi free trade zones, technology parks and special, economic zones.

Govt no to review of FDI cap in insurance

The Government has decided to take the negotiating position of not changing the existing foreign equity cap of 26 per cent in the insurance sector during the forthcoming financial services negotiations under the General Agreement on Trade in Services (GATS). India's commitments on various segments of financial services, including insurance, are expected to be taken up for review mid-year as part of the ongoing mandated negotiations on GATS.

Published on July 12, 2021

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