A law requiring less than 120 days’ stay in India to claim Non-Resident Indian (NRI) status needs to be changed, an association representing NRIs has demanded, citing economic disruptions due to the coronavirus pandemic.
The US-based Global Organisation of People of Indian Origin (GOPIO) has asked Finance Minister Nirmala Sitharaman to change the provision, implemented through the Finance Act, 2020, saying it is a “hard blow” to many NRIs.
“According to Income Tax laws, a person can qualify as an NRI if he stays in India for less than 120 days. Then his global income is exempted from tax in India as an NRI. However, his income in India would still be taxed,” chartered accountant Sunil Rawla said.
In a letter to Sitharaman, GOPIO president Sunny Kulathakal has said NRIs and the People of Indian Origin (PIO) have been substantially contributing to the Indian economy.
According to a World Bank report, India is the top recipient of remittances in the world. In 2018, the Indian diaspora sent a whopping $79 billion back home, a rise of 14 per cent from the previous year, Kulathakal said.
“In view of the world-wide lockdown due to COVID-19 pandemic and the unprecedented disruption of economic activities, GOPIO appeals to the government of India for immediate repeal of the revised NRI status duration rule of 120 days and make it 182 days, which has existed for long,” he said.
The new rule is akin to penalising all NRIs, Kulathakal said.
“Entire nation is suffering due to the closure of borders, shutdown of airlines and other means of transportation. Many NRIs are forced to stay longer in India due to quarantine and travel restrictions imposed on them to combat the pandemic, resulting in losing their NRI status,” he said.
“In view of these disruptive developments that are beyond our control, we plead before you to revoke the provision on NRI status introduced through the Union Budget 2020,” Kulathakal said.
The GOPIO is the largest network of the Indian diaspora, which was founded in 1989 in New York, the letter said.
Though the initial focus of the organisation was on human rights violations against the people of Indian origin, over the past three decades, it has been actively involved in the social, economic, cultural and educational issues of the PIO community and NRIs around the globe.
