New
Delhi: The Confederation of Indian industry (CII)
has asked for the removal of fiscal hurdles as a measure
of support for Indian companies making overseas investments
in global markets.
In
a statement, the apex industry body said, "The
efforts of Indian companies in making investments overseas
by setting up manufacturing and other facilities through
joint ventures and subsidiaries needs to be supported
by removal of fiscal hurdles."
It
outlined budgetary measures and said repatriation of
money in to the country should be encouraged through
fiscal incentives to balance the high rate of outgoing
investment from India.
CII
emphasised that the dividends received by an Indian
company from a foreign company, whether its subsidiary
or joint venture, though received in foreign exchange,
was fully taxable. It has suggested that dividends received
from such entities in convertible foreign exchange should
be in line with the dividend received from any domestic
company.
The
chamber also pointed out that where the government has
entered
into an agreement with foreign countries for granting
tax relief, an option was available to the assesse to
apply either the provision of domestic law or treaty
law, whichever is more beneficial to him.
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