Tax break for electronics suppliers to be extended till 2041 under new Taxation Bill

The Centre has moved to extend by another decade the tax exemption for foreign companies supplying capital goods, equipment and tooling to India’s electronics contract manufacturers, signalling its intent to sustain the investment momentum that has transformed the country into a global electronics production hub.

The proposal, included in the Taxation and Other Laws (Amendment) Bill, 2026 tabled by finance minister Nirmala Sitharaman in Parliament on Tuesday, seeks to extend the exemption under Schedule IV of the Income-tax Act, 2025, from FY31 to FY41 by replacing the existing cut-off of “2030-2031” with “2040-2041”.