Only NRIS with income from India to be taxed
NEWDELHI: Finance minister Nirmala Sitharaman, a day after presenting the Union budget 2020-21, said on Sunday the government has no intention to tax global income of Non-resident Indians (NRIS) and clarified that only the income generated in India will be taxable.
The Union minister was speaking on a range of issues at a press conference in New Delhi a d a y a f t e r t h e b u d g e t was announced. She also said the new tax regime to be introduced will definitely benefit taxpayers in certain brackets and that the government will issue more clarifications on it.
Following the budget presentation on Saturday, there was confusion about the tax liability of NRIS on their global income. “What we are doing now is that the income of an NRI generated in India will be taxed here. If he’s earning something in a jurisdiction where there is no tax, why will I include that into mine that has been generated there [oversees].”
On taxes for NRIS
NIRMALA SITHARAMAN, finance minister
“Whereas if you have a property here and you have a rent out of it, but because you are living there, you carry this rent into your income there and pay no tax there, pay no tax here... since the property is in India, I have got a sovereign right to tax,” she said in a post Budget interaction with the media on Sunday.
“I am not taxing what you’re earning in Dubai [as an example] but that property which is giving you a rent here. You may be an NRI, you may be living there but
On new tax regime
What we are doing now is that the income of an NRI generated in
India will be taxed here. If he’s earning something in a jurisdiction where there is no tax, why will I include that into mine
Because income cuts are deeper in the new scheme, we believe a taxpayer from income bracket will be much better coming into the new system
that is revenue being generated here for you. So that’s the issue,” the finance minister added.
The Finance Bill, 2020 has proposed that an Indian citizen shall be deemed to be resident in India if he is not liable to be taxed in any country or jurisdiction. This is an anti-abuse provision since it is noticed that some Indian citizens shift their stay in low or no tax jurisdiction to avoid payment of tax in India, the finance ministry said in a statement.