The Finance Bill 2013 proposes to provide parity in taxation between an IDF-Mutual Fund that distributes income and an IDF-NBFC that pays interest when the payment is made to a non-resident. Presenting the Union Budget in the Lok Sabha today, the Finance Minister Shri P.Chidambaram said that the rate of tax on such distributed income or interest will be 5 percent. He also stated that investor protection fund set-up by depositor for protection of the interest of beneficial owners will be exempt from income tax.
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