Finance Ministry Details Conditions for Foreign Cloud Firms' Tax Holiday Eligibility

The Indian Finance Ministry clarified four key conditions for foreign cloud service companies to qualify for a tax holiday announced in the 2026-27 Budget, valid until 2046-47. Eligible firms must be notified, use MeitY-approved Indian data centres, and provide services to Indian users through Indian reseller entities. While global income of these foreign companies will not be taxed in India, profits from domestic data centre services and resales remain taxable. A 15% safe harbour margin applies if the Indian data centre is related to the foreign company, ensuring a level playing field.