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September, 2006 Pragati Maidan, New Delhi, India |
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Pharma gets off lightly too.
Fringe benefit tax not the devil after all
The actual version of the fringe benefit tax for the pharma industry is not the devil the industries painted it to be. The tax on 5% of the expenses is not of much consequence to the fast growing sectors. Moreover, actual reimbursement, leased lines and certain expenses like gust houses for training are out of the tax nets.
Though elated by the lowered tax rate many in the industry still find the paper work a big irritant. Also in the pharma industry employees’ travel expenses account for roughly 10% of the total corporate expenses. With the taxable component of this being cut to just 5%, the total tax incidents on the companies would be just marginal, less than even 0.5%
Date: 03-May-2005
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