Special Economic Zones (SEZs) which contribute over 30 % of country’s exports have been adversely hit by Budget 2011 proposals as the SEZs have been brought under Minimum Alternate Tax (MAT) by 20.1 percent (including cess) and dividend distribution tax (DDT) at 16.22 percent (including cess). SEZs were hitherto exempt from both these taxes. The units as well as developer, both will be liable to MAT and DDT a year ahead of Direct Tax Code (DTC) which is intended to be in place in April 2012. However, some relief has been given to SEZs by way of exemptions from service tax to taxable services provided within SEZ and simplification of the refund procedures.
Indian Citizens who applied for Passport in India Can now check their Passport Status online. We are giving below a link where the Applicant have to Selce City, enter File Reference No. and Select Year of Registration and his status will appear on the website. Link to know the Passport Status is as follows:- My Passport status
Transfer pricing Audit due date for corporate assesses extended to 30th November- Budget 2011-12. Section 139 of the Income-tax Act stipulates 30th September of the assessment year as the due date for filing of return of income in case of corporate assessees. In addition to filing a return of income, assessees who have undertaken international transactions are also required (under the provisions of section 92E) to prepare and file a transfer pricing report in Form 3CEB before the due date for filing of return of income.
The Finance Minister has in Budget 2011-12 proposed to introduce self-assessment in Customs. In it speech the Finance Minister had said that this is done to quicken the clearance of the cargo by Customs authorities and to further modernize the Customs administration. It was further stated that under this, importer and exporters will themselves assess their duty liabilities while fighting declarations in the EDI system. The Department will verify such assessments on a selective system driven basis.
The service tax on the services provided by an Authorised Service Station was made taxable from 16.07.2001 onwards. In the start only servicing or repair of motor cars, two-wheeled and light motor vehicles by service stations or centres authorized by the manufacturers was covered under this service. From 16.06.2005 onwards reconditioning or restoration services were also covered.
The Export of Service Rules, 2005 provides that there will no service tax on the export of services. In these rules, the criteria are prescribed as to what will constitute export of service. In Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 the services received from outside India are taxed. Now, Budget 2011 changes have been made in these Rules. The changes in Export of Service Rules, 2006 have been made vide Notification No. 12/2011-ST dated 01.03.2011. And similar re-arrangement has been effected in the Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 vide Notification No. 13/2011-ST dated 01.03.2011. These changes will come in effect from 1st April, 2011.
Who says tax policy and tax planning do not go hand in hand. Here is a live example of frequent tax policy change and failed tax planning without any wrong motives. When the concept of limited liability partnerships was introduced in India two years back, it was advocated that LLPs are a better, easier and tax friendly option, compared to corporate entities .
India in future is going to be a younger India with nearly 70 percent of India being of working age in 2025. Its demographic dividend of a relatively young population as compared to developed nations is an opportunity in the offing. The budget has addressed the higher education and skill development needs by a substantial higher allocation of funds, though no direct tax benefit has been given.
While the Finance Minister has said that his priorities were directed towards making taxes moderate, payment simple and collection of taxes easy for the tax collectors, the changes proposed result in higher indirect tax collection by over Rs. 11000 cores. He admits that there has been a healthy growth in indirect taxes in 2010-11 and as such peak tax rates have not been tinkered with.
Under the existing provisions contained in section 115R(2) of the Income-tax Act, a Mutual Fund is liable to pay additional income-tax on the amount of income distributed to its unit holders. It is proposed to levy additional income-tax at a higher rate of 30 per cent. on income distributed by debt funds to a person other than an individual or HUF.
