India allows foreign firms to supply equipment to contract manufacturers tax-free
Rule removes tax exposure on equipment ownership in bonded facilities
Change
India allowed foreign firms to supply equipment to contract manufacturers without tax exposure in bonded areas.
Why it matters
The rule exempts foreign-owned equipment from triggering tax liability when used by contract manufacturers in bonded facilities. It applies within defined conditions and timelines.
Implications
- — Manufacturers must structure operations within bonded facility rules — non-compliance risks tax liability
- — Tax teams must apply new exemption correctly — errors risk financial exposure
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