Niti Aayog proposes fixed-rate taxation for foreign firms investing in India
Niti Aayog has suggested a new, easier tax system for foreign firms investing in India.
The plan would let these companies pay taxes at a fixed rate, skipping all the complicated paperwork and endless debates about whether they have a "permanent establishment" here.
The goal? Make India more welcoming for global investors and avoid any surprise tax changes down the road.
Benefits of the new system
Under this scheme, tax officials wouldn't keep arguing over technicalities for covered activities, and companies would get some much-needed peace of mind (thanks to safe harbor rules).
There's also a push to train officers so everyone follows the same rules—especially when it comes to digital businesses or cross-border deals.
Plus, profit rates could be adjusted by industry, so the system actually fits different types of businesses.