Through the proposed Direct Taxes Code Bill, non-resident Indians working on a global income are liable to pay their dues. Failure to comply will carry sanctions.

Under the existing law, Income Tax Act of 1961, an individual with an NRI classification is compelled to pay taxes if he or she is in India for a period or periods of 182 days. This meant that if an NRI wanted to escape paying, he or she will have to be out of the country for six months. This apparently had been prone to misuse and resulted in the total avoidance of taxes in any country by the clever.

Under the new guidelines, an NRI will be considered a tax resident if he or she stays in India for over 59 days in that year and has been in the country for over 365 days in the four preceding years. The Central Board of Taxes says that affected NRIs, particularly those who visit the country several times a year, will be given relief from payment for two years on their global income during the transition period. The new rules also trim down the NRI classification to 'Resident' and 'Non-resident', and does away with 'Resident Not Ordinarily Resident' to simplify the matter.

The new code is expected to take effect on 1 April 2012.

There are over 25 million Indians staying out of the country, with one million of these visiting their homeland annually.