Govt Plans 20-Year Tax Break for Data Centres

Incentives in Meity's draft include GST input tax credit on assets

- AASHISH ARYAN

The government has proposed a tax exemption of up to 20 years for data centre developers, provided they meet targets on capacity addition, power usage effectiveness, and employment generation. These incentives are outlined in a new draft of the National Data Centre Policy, reviewed by Business Standard and circulated among stakeholders for consultation.

According to the draft, the Ministry of Electronics and Information Technology (Meity) is likely to request the Ministry of Finance to allow input tax credit (ITC) on the goods and services tax (GST) levied on capital assets, such as data centre construction, heating, ventilation, and air conditioning equipment, and other electrical systems used in data centres.