Reportedly Finance minister nirmala sitharaman on sunday said the government has full sovereign right on the income generated by an nri in india and as such he will be taxed as per indian laws. She, however, said, the income accruing to the nri from the country he is living in wouldn’t be taxed by India.
“Here’s a situation where an nri is earning in some other country and he is not taxed there. He has some earnings in india as well, but because he doesn’t live here, he doesn’t pay tax here too. What we are saying now (in Budget) that pay tax for the income generated in india,” said the Finance Minister. “If he is earning in a no-tax jurisdiction, why would we include that into our calculations? If you have a property in india and have got a rent through it, therefore, you carry this income too, meaning no tax there or no tax here. We have corrected this because this income is in the jurisdiction od india,” she said.
The Union Budget 2020 proposed to tax indians who are not residents in india, but “their earnings” will be taxed. So there was confusion if all their incomes from all sources all over the world will be taxed by India. Now the FM has cleared that it is only india income that would be taxed for NRIs.
