Too many riders for low value-adding services
The much-awaited amendment to the Safe Harbour Rules (a provision in a law or regulation that offers protection from liability or penalty under specific situations or if certain conditions are met) provides an avenue for taxpayers with lower thresholds of related party transactions pertaining to IT, ITeS, BPO/KPO/Contract R&D services, etc to pay taxes on a presumptive basis. While there could still be issues around the classification of a particular service in a particular basket, the safe harbour margins are more or less in line with the expectations of