Effective or announced 30 March 2026Impact for foreign investors: high
What changed
The Finance Act 2026 cut MAT from 15% to 14% of book profit and made it final, with no new credit. It exempts a notified foreign company’s income from Indian data-centre services to the tax year ending 31 March 2047, subject to conditions. IFSC units get a 100% deduction for 20 consecutive years out of 25. It also replaced the penalty for not furnishing the TP accountant’s report with a fee. The proposed 15% post-holiday IFSC rate was not enacted.
Who it affects
Companies outside the concessional regime, foreign cloud providers, and IFSC units.
What to do
Re-test the choice between the normal and concessional regimes, and check the data-centre exemption conditions before structuring cloud sales.