Saturday, February 1, 2020

HIghlight of Budget 2020 [ taxes] ' - As per FM Speech

A.           DIRECT TAXES


Ø  New Simplified Personal Income Tax Regime [optional for Individual taxpayers] introduced:  

·       Income upto Rs. 5 lakh  - NIL

·       5 to 7.5 lakh                  - 10%

·       7.5 to 10 lakh                -  15%

·       10 to 12.5 lakh              - 20%

·       12.5 to 15 lakh              - 25 %

·       15 lakh & above           - 30%

In the above regime, no deduction or exemption shall be allowed to taxpayers.

Ø  Proposal to remove 70 out of 100 exemptions and deduction in tax regime

Ø Pre-fill information of donation will result in hassle-free claims for the individuals claiming tax exemption.


Ø  'Vivad se Vishwas' scheme for direct tax payers whose appeals are pending at various forum, no interest and penalty will be charged if taxpayers pay by March 31, 2020. The scheme is applicable for all pending appeals at all levels. Scheme to end in June 2020.

Ø  Turnover limit for deductions under Section 80-IAC to start-ups has been proposed to be increased to Rs. 100 crore.

Ø  Dividend Distribution tax has been abolished. The dividend will be taxable in hands of the recipients. Dividend received by holding from subsidiary is exempt.

Ø Concessional tax rate of 15% extended to power generation companies.

Ø ESOP: Ddeferment of tax payment by employees on ESOPs from startups by five years.

Ø 100% tax concession to sovereign wealth funds on investment in infra projects.

Ø Option to be provided to cooperative societies to be taxed at 22% plus 10% surcharge and 4% cess, with no exemptions or deductions. Cooperative societies to be exempted also from Minimum Alternative Tax.

Ø  The date of approval of affordable Housing project has been extended to 31st mar 2021 for getting tax benefits.

Ø  The Threshold limit for conducting tax audit has been extended from Rs. 1 crore to Rs 5 crore.

Ø  Currently, while taxing income from capital gains, business profits and other sources in respect of transactions in real estate, if the consideration value is less than circle rate by more than 5 percent, the difference is counted as income both in the hands of the purchaser and seller. This limit has been increased to 10%.

Ø  Process of registration of Charitable Institutions shall be made completely electronic under which a unique registration number (URN) shall be issued to all new and existing charity institutions. To facilitate the registration of the new charity institution which is yet to start their charitable activities, proposal to allow them provisional registration for three years.

Ø  Income Tax Act to be amended to allow faceless appeals against tax orders on lines of faceless assessment.

Ø  PAN will be issued instantly based on Aadhaar without any documentation.

Ø  TDS rates reduced for FPIs, municipal bonds & interest on listed bonds

B.            INDIRECT TAXES:

Ø  New GST return systems will be effective from 01.04.2020.

Ø  E invoicing for assessee having turnover more than 100 crores is mandatory with effect from 01.04.2020.

Ø  Announcement of health cess on import of medical equipment.

Ø  Custom duty raised on footwear and furniture.

Ø  Customs Act being amended to neutralise misuse of FTA provisions

Ø  Amending laws to ensure no undue gains for imports under FTA

Ø  To transfer FY17, FY18 cess balance to GST compensation fund

Ø  GST compensation to states to be limited to cess collection.

Friday, July 5, 2019

Highlights of Budget 2019 :- Based on FM Speech

A.           DIRECT TAXES


Ø  Income Upto Rs. 5 Lakh Exempt from taxation.

Ø  Additional income tax deduction of Rs 1.5 lakh on the interest paid on loans for Electronic Vehicles.  

Ø  Propose to extend period of exemption of capital gains arising from sale of residential house for investment in startups to 31-3-2021.

Ø  Additional deduction of Rs. 1.50 lakh for interest paid on home loan is proposed for purchase of an affordable house valued up to Rs. 45 lakh.

Ø  Proposal to enhance surcharge on individual income of Rs 2-5 crore and over Rs 5 crore by 3% and 7% respectively.

Ø  Additional income tax deduction of up to Rs. 2.5 lakhs is proposed on payment of interest on loan taken to purchase electronic vehicles.


Ø  Companies with turnover of up to Rs. 400 crore to be taxed at 25 per cent.

Ø  Proposal of TDS of 2% on cash withdrawal of Rs. 1 crore in a year from bank account.

Ø  Faceless assessment in electronic mode without human interface has been launched this year.

Ø  Proposal to exempt business establishments with annual turnover of up to Rs. 50 crores from any charges or merchant discount rate levied for accepting digital payment.

Ø  To resolve the so-called “Angel Tax issue”, the startups and their investors who file requisite declarations & provide information in their returns will not be subjected to any kind of scrutiny in respect of valuations of share premiums.

Ø  Relaxed norms for set off and carry forward of losses for start-ups have been proposed.

Ø  Additional Tax benefits to GIFT [Gujarat International Finance Tech City]  like several direct tax incentives to an IFSC including 100 % profit-linked deduction under section 80-LA in any ten-year block within a fifteen-year period, exemption from dividend distribution tax  from  current and accumulated income to companies and mutual funds, exemptions on capital gain to Category-III AIF and interest payment on loan taken from non-residents.  

Ø  Relief in levy of Securities Transaction Tax (STT) by restricting it only to the difference between settlement and strike price in case of exercise of options.

Ø  Proposal to make PAN and Aadhaar interchangeable and allow those who do not have PAN to file Income Tax returns by simply quoting their Aadhaar number and also use it wherever they are required to quote PAN.

Ø  Pre-filled tax returns will be made available to taxpayers which will contain details of salary income, capital gains from securities, bank interests, and dividends etc and tax deductions.

B.            INDIRECT TAXES:

Ø  Taxpayers with an annual turnover of less than Rs 5 crores will have to file only quarterly GST returns.

Ø  Lower GST rate on electric vehicle from 12% to 5% is proposed before GST Council.

Ø  Import of defence equipment is exempted from Basic Custom Duty.

Ø  Propose to increase special additional duty and road and infrastructure cess on diesel and petrol by Re 1.

Ø  Customs duty being exempted on certain parts of EVs.

Ø  A Legacy dispute resolution scheme to resolve VAT/service tax issues.

Ø  Basic customs duty is being increased on items such as cashew kernels, PVC, Vinyl flooring, tiles, metal fittings, mountings for furniture, auto parts, certain kinds of synthetic rubbers, marble slabs, optical fibre cable, CCTV camera, IP camera, digital and network video recorders etc.


*     Average amount spent on food security per year approx. doubled during 2014-19 compared to preceding five years,

*     The Indian economy will grow to become a $3 trillion economy in the current year itself. It is now the sixth largest in the world. Five years ago it was at the 11th position. From 1.85 trillion dollars in 2014, the economy has reached 2.7 trillion US dollars; we can very well reach 5 trillion dollars in the next few years.

*     Incentives for faster adoption of electric vehicle is next target of Govt.

*     210 Kms of metro lines have been operationalized in 2019 and new metro rail project for 300 Kms have been approved.

*     Bharatmala Scheme enhanced development of roadways in India

*     ‘One Nation One Grid’ to ensure power availability of electricity in India

*     Govt will create a payment platform for MSMEs to enable filing of bills and payment on the platform itself.

*     A modern tenancy law will be finalized and given to the states

*     It is proposed that several reform measures will be taken up to promote rental housing.

*     The govt launched UDAY in 2015 for financial and operational turnaround of discoms. We are analyzing the scheme and plan to improve it further.

*     It is proposed to use Public-Private partnership to unleash faster development.

*     100% FDI will be permitted for insurance intermediary.

*     FDI inflows have remained robust despite global headwinds. India's FDI inflows remained strong despite global slippages. We saw a 6% y-o-y growth in foreign investment.

*     As key source of capital to Indian economy, it is important to ensure hassle-free experience to foreign portfolio investors. Plan to streamline KYC to make it more investor-friendly.


*     For Pradhan Mantri Karam Yogi Maang Dal scheme, one will require only Aadhaar and bank account.

*     Several reforms would be undertaken to promote rental housing, current rental laws are archaic as they do not address lessor-lessee relationships fairly.

*     India has emerged as a major space power. Time has come to harness this ability commercially. New Space India Limited, a public sector enterprise, has been incorporated to tap the benefits of R&D carried out by Isro. The company will spearhead commercialization of various space products.

*     Pension benefit to be extended to around 3 crore retail traders and shopkeepers with an annual turnover less than 1.5 crores under Pradhan Mantri Karam Yogi Man Dhan Scheme.

*     Social Stock Exchange under SEBI proposed

*     NRI investment in Indian capital market is less. Proposal to merge the NRI portfolio investment scheme route with FPI route.

*     Proposal for social stock exchange for raising funds via equity and debt instruments

*     Local sourcing norms will be eased for the FDI in single brand retail sector.

*     NRI investment in Indian capital market is less. Proposal to merge the NRI portfolio investment scheme route with FPI route.

*     Credit Guarantee Enhancement Corporation will be set up in 2019-20, with an action plan to deepen markets for long-term bonds with specific focus on infra sector to be put in place.

*      Pension benefit to be extended to around 3 crore retail traders and shopkeepers with an annual turnover less than Rs 1.5 crores under the Pradhan Mantri Karam Yogi Man Dhan Scheme.

*     Govt to ease up FDI regulations for various sectors like media, insurance & others

*     By 2022 every single rural family except those who are unwilling to take the connection, will have electricity and clean cooking facility.

*     The department of fisheries will address critical gaps in the value chain, including production, quality control, post-harvest management, etc.

*     1.95 crore houses proposed to be provided under PMAY Grameen by 2021

*     To deepen corporate tri-party repo market in corporate debt securities, government will work with regulators RBI & SEBI to enable stock exchanges to allow AA rated bonds as collaterals.

*     1.25 lakh kilometers of roads will be upgraded.

*     Local sourcing norms for FDI to be eased for single-brand retailing sector.

*     Jal ministry to focus on providing adequate drinking water, which is a primary area of concern. We seek to provide water to all rural households under 'har ghar jal.

*     Steps such as these will help double farmers' income by 2022.

*     Interoperability of RBI depositories and SEBI depositories necessary for seamlesss transfer of treasury bills; govt. will take necessary measures in this regard in consultation with RBI and SEBI.

*     Under Pradhan Mantri Awas Yojna - Urban, over 80 lakh houses have been sanctioned.

*     A Gandhipedia is being developed to sensitize youth and society at large on positive Gandhian values.

*     New Space India Limited (NSIL) has been incorporated to tap benefits of ISRO. It will help harness India's space ability commercially: Nirmala Sitharaman.

*     India has emerged as a major space power. It is time to harness our ability commercially. To harness India's space ability commercially, a public sector enterprise, New Space India Limited has been incorporated to tap benefits of the Indian Space Research Organisation.

*     A New National Education Policy to be brought to transform Education system with better governance & promote research.

*     None of our technological institutions were in top 200 in 2014. But now, there are five in the list.

*     To upgrade level of teaching, Gian initiative was started. It was a roadmap to counter challenges.

*     80 business incubators and 20 technology business incubators to be set up in 2019-20 under ASPIRE to develop 75,000 skilled entrepreneurs in Agro-Rural Industries.

*     10 million youth to take up industrial training under PMKVY.

*     FAME II scheme aims to provide necessary charging infra and encourage faster adoption of electric vehicles for the common man.

*     Will invest widely in agricultural infrastructure. We will support private entrepreneurship in driving value addition to farmers produce and those from allied activities too, like bamboo, timber and also for generating renewable energy. Annadaata ko kyun oorja daata bana nahi sakte?,

*     Electronic Fundraising Platform, a social stock exchange, to be set up to list social enterprises and voluntary organizations working for social welfare objectives.

*     Under Pradhan Mantri Grameen Digital Saksharata Abhiyan, BharatNet is targeting internet connectivity in local bodies in every panchayat in the country; this will be speeded up under the Universal Service Obligation Fund.

*     35 crore LED bulbs distributed under the Ujjwala scheme, leading to a cost saving of Rs 18,341 crore annually.

*     Govt to increase focus on new-age skills like AI, Virtual Reality & Big Data.

*     The Pradhan Mantri Shram Yogi Maan Dhan Yojana of providing Rs 3,000 per month - nearly 30 lakhs workers have joined the scheme.

*     Propose to consider issuing Aadhaar to NRIs with Indian passports after their arrival in India without the mandatory wait of 180 days.

*     Under PMAY (Urban), over 81 lakh houses with investment of about Rs 4.83 lakh cr have been sanctioned of which construction has started in about 47 Lakh houses. Over 26 Lakh houses have been completed of which nearly 24 Lakh houses have been delivered, to beneficiaries.

*     To popularize sports at all levels, National Sports Education Board for development of sportspersons to be set up under Khelo India.

*     Govt to develop 17 world class iconic tourism sites.

*     PSBs are now proposed to be further provided Rs 17,000 crore of capital to boost credit.

*     Ease of Living: Door-step banking & online personal loans are proposed

*     NBFCs are playing importation role in the economy; Rs. 1 lakh crore to be provided as credit guarantee for purchase of high rated pooled assets.

*     For purchase of high-rated pooled assets of financially sound NBFCs amounting to a total of Rs 1 lakh crore, govt will provide a one-time six-month partial credit guarantee to PSBs for first loss up to 10%.

*     Govt proposes to return the regulation authority over housing finance sector from National Housing Board to the RBI.

*     Exclusive TV programme exclusively for startups to be started, channel will be designed and executed by startups themselves.

*     Further encourage women entrepreneurship, Women SHG Interest Subvention Programme to be expanded to all districts in India.

*     Every verified woman SHG member having a Jan Dhan account, an overdraft of Rs 5000 will be allowed. One woman in every SHG shall be made eligible for a loan of Rs 1 lakh under MUDRA scheme.

*     To improve capital flow in economy, Govt will do strategic disinvestment.

*     Regulation of Housing Finance is proposed to be shifted to RBI from NHB.

*     Mission for integrating traditional artisans and their creative products with global markets to be launched; patents and Geographical Indications to be obtained for them where necessary

*     India's sovereign external debt to GDP is amongst the lowest globally at less than 5%.

*     A new series of coins easily identifiable to the visually impaired shall be released for public use shortly.

*     Income-tax has increased by over 78% from Rs. 6.38 lakh crores in FY 2013-14 to Rs. 11.37 lakh crores in FY 2018-19.

HIghlight of Budget 2020 [ taxes] ' - As per FM Speech

A.            DIRECT TAXES INDIVIDUALS / HUF / AOP / BOI Ø   New Simplified Personal Income Tax Regime [optional for Individua...