Taxing to help Global Firms outsourcing to India

Forbes.com reports that Indian outsourcing tax initiatves taken by government recently is going to to help global firms



The government issued a tax clarification last month, saying multinationals outsourcing their non-core business to India were exempted from taxes to avoid double taxation. But the clarification has raised some doubts about what is taxable and what is exempt. Some industry experts said the tax authorities' explanation sought to include a part of the foreign company's global income for tax purposes in India. A survey carried out by consultancy firm Ernst & Young said that 58 percent of the activities outsourced to India were considered non-core, and were therefore not taxable.