Budget wishlist: Nasscom calls for cloud tax clarity, Esop tax deferment for more startups

Industry body Nasscom hopes that the Union Budget will extend Employee Stock Option Plan (ESOP) tax deferment to more startups and bring suitable clarifications to address concerns around the tax treatment of foreign cloud use of Indian data centres.

The association – whose members include IT companies and tech players across-the-spectrum, of varying size and scale – wants the Budget to clarify that procuring hosting or co-location services from an Indian data centre operator would not create a business connection or permanent establishment for the foreign cloud service provider, as the arm’s length payments to the Indian player fully cover India-based functions.