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Union Budget of 2019 -20was presented by Finance Minister Smt. Nirmala Sitharaman on July 05, 2019 before the Parliament. Here are summary of key amendments related to Corporate and Personal Taxation, Custom Duty, Service Tax, Excise and GST for your reference:
| Corporate and Personal Taxation: | |
| S. No. | Proposed Amendments Summary |
| 1 | Domestic companies to be taxed at 25% if the turnover/gross receipt is upto INR4 billion, as against earlier threshold of INR 2.5 billion – Increased threshold to now cover 99.3% of domestic companies |
| 2 | TDS rate of 2% to be applicable on aggregate cash withdrawals exceeding INR10 million from bank accounts in a financial year – Measure introduced to support digitalization and discourage cash transactions |
| 3 | Investment-linked income tax deduction likely to be introduced for mega-manufacturing plants set up in sunrise and advanced technology areas producing: Semi-conductor fabrication (FAB), solar photo voltaic cells, lithium storage batteries, solar electric charging infrastructure, computer servers, laptops |
| 4 | Demerger provisions relaxed to exempt Ind-AS-resulting company from recording assets and liabilities of demerged undertaking at book value in hands of demerged company |
| 5 | E-assessment regime to bring paradigm shift: a) Emphasis on faceless scrutiny assessments (i.e., without human interface) — scheme to be launched in a phased manner b) E-notices to be issued without disclosure of name, designation and location of assessing officers c) Central cell to be central point of contact for taxpayer |
| 6 | TDS at the rate of 5% to be applied on contractual work or professional fees payments (for the purpose of business or profession) made by an individual/HUF, not subject to tax audit where annual aggregate of payments exceeds INR 50 lakh in a year
– No requirement to obtain TAN for deposit of such TDS; PAN only to facilitate the compliance process |
| 7 | For ease of taxpayers, PAN and Aadhaar will be made interchangeable, and taxpayers without PAN can file the tax returns quoting Aadhaar. |
| 8 | In the case of an individual, an enhanced surcharge of 25% is leviable on taxable income exceeding INR2 crore till INR 5 crore and 37% on taxable income exceeding INR5 crore. |
| 9 | Additional income tax deduction of up to INR 1.5 lakh will be available for loans taken by individuals from any financial institution for purchase of electric vehicles between 1 April 2019 and 31 March 2023. |
| 10 | An additional income tax deduction up to INR 1.5 lakh will be provided for purchase of first residential property: – If the loan has been sanctioned between 1 April 2019 and 31 March 2020 – Stamp duty value of the property does not exceed INR 45 lakh – Individual not owning any other residential property on date of sanction of loan |
| 11 | Prefilled tax returns forms enumerating salary, bank interest, capital gain from securities and dividends, etc., will be made available for taxpayers. |
| 12 | With a view to enable the pensioner to have more disposable funds, the exemption will now be increased for any payment from the NPS Trust to a taxpayer, from 40% to 60% of the total amount payable at the time of closure/opting out of the scheme. |
| 13 | New category of taxpayers are mandatorily required to file tax returns if during the previous year : – Expenditure incurred is more than INR 2 lakh for foreign travel – Electricity expenditure exceeding INR 1 lakh – Deposits in current account exceeding INR 1 crore – Satisfying other prescribed conditions |
| Customs Act | |
| S. No. | Proposed Amendments Summary |
| 1 | Proposal to increase Customs duty on products, such as tiles, vinyl floorings, CC TV cameras, auto parts and other goods in order to provide level playing field to domestic manufacturers and encourage Make in India initiative – Customs duty rationalisation/exemption for certain products, including parts of electric vehicles/ defence equipment not manufactured in India |
| 2 | General penalty for any contravention of customs provisions increased from INR1 lakh to INR4 lakh |
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| Indirect Taxation | |
| S. No. | Proposed Amendments Summary |
| 1 | Special additional excise duty and road and infrastructure cess increased by INR 1 each on petrol and diesel Highlights Amnesty scheme . This is applicable w.e.f. July 06, 2019 |
| 2 | A resolution cum amnesty scheme “Sabka Vishwas (Legacy Dispute Resolution) Scheme” to resolve and settle huge overload of pending litigations under Excise and Service Tax law |
| 3 | Suggestion to GST council to reduce GST rate from 12% to 5% for electric vehicles . Also Custom duty exemption on import of certain electric vehicle parts |
| 4 | Basic custom duty will be increased on certain auto parts to promote Make in India initiative |
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