NBFCs likely to get tax treatment parity with banks
Gireesh Chandra Prasad, Arun S: New Delhi, Feb 21 2013, 02:53 IST
36(1)(vii a) of the Income Tax Act.
Under this Section, provisions for bad and doubtful debts made by banks are granted deduction of 7.5% from the gross total income and 10% of aggregate average rural advances made by them. Alternatively, the banks also have an option to claim a deduction of 10% (up from the earlier 5%) on any provision made for assets classified by the RBI as doubtful / loss assets. However, this benefits is not given to NBFCs. Sources said the finance ministry is examining if parity could be accorded to NBFCs on this front too.
A finance ministry panel on NBFCs has also recommended tax parity to both banks and NBFCs on both taxation of income from NPAs in the year of receipt and on deductions under Section 36(1)(viia).
Previous Story AirAsia takes Tatas back to skies in three-way JV for budget airline Next Story Deflated auto cos turn to local talent to woo Indian market
Reader's Comments| Post a Comment
Be the first to comment.
