The Central Board of Direct Taxes (CBDT) has issued a new notification on January 21, 2025, introducing special provisions for non-resident businesses engaged in operating cruise ships under Section 44BBC of the Income-tax Act, 1961. These changes, known as the Income-tax (First Amendment) Rules, 2025, aim to regulate and define the conditions for computing profits and gains for such operations.
Key Highlights of the Notification
- Applicability:
The rules apply to non-residents operating cruise ships for leisure and recreational purposes in India. - Conditions to Qualify for Section 44BBC:
To benefit under this section, the following conditions must be met:- The cruise ship should have the capacity to carry more than 200 passengers or be at least 75 meters long. It should also have appropriate dining and cabin facilities for passengers.
- The ship must operate on scheduled voyages or shore excursions, touching at least two Indian sea ports or revisiting the same port twice.
- The ship should primarily carry passengers and not cargo.
- Operations must comply with guidelines issued by the Ministry of Tourism or the Ministry of Shipping.
- Effective Date:
The rules take effect from the date of their publication in the Official Gazette.
Why These Rules Matter
These amendments aim to promote the cruise tourism industry in India by providing clarity and specific provisions for tax compliance. By defining the operational framework, India hopes to attract more international cruise operators while ensuring proper tax regulations are in place.
Read the Official Circular