Key Highlights of Union Budget 2019-20 ON Direct Tax And Indirect Tax

Finance minister Nirmala Sitharaman has presented Narendra Modi government’s 2.0 First Budget. Below are Key Highlights of Union Budget 2019.

Direct Tax:

1. Additional income tax deduction of up to Rs. 1.5 lakhs is proposed on payment of interest on loan taken to purchase electronic vehicles

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

3. Threshold limit for reduced tax rate of 25% in case of companies is proposed to increased from Rs. 250 crores to Rs. 400 crores

4. Additional deduction of Rs. 1.50 lakh for interest paid on home loan is proposed

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

6. To resolve the issue of Angel Tax the startups and investors who file requisite declarations will not be subjected to any kind of scrutiny in respect of valuation of share premium. A mechanism of e-verification will be put in place and with this, the funds raised by startups will not require any tax scrutiny.

7. The Securities Transaction Tax or STT is proposed to be restricted to the difference between settlement and strike price of options

8. Adhaar card can be used instead of PAN for filing of ITR

9. FM proposed TDS of 2% on cash withdrawal of Rs. 1 crore in a year from bank account

10. Prefilled income Tax Returns to be made available for tax payers

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

12. FM proposed 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

13. In view of rising income levels, a surcharge will be levied on individuals with taxable income of Rs 2 to 5 crore, and Rs 5 cr and above. The effective tax rate for these categories will increase by around 3% and 7%, respectively

14. Budget 2019: No change in income-tax slabs proposed

Indirect Tax:

1. GST rates have been eased with a relief of Rs 92,000 crore provided during the year. Further measures are being worked out to ease filing returns and tax compliance. A simplified single monthly return is now being ruled out. Taxpayers with an annual turnover of less than Rs 5 crore will have to file only quarterly returns

2. SAD & Road Cess increased by Rs. 1 on Petrol

3. Custom duty on Gold and precious metal increased from 10% to 12.5%

4. Customs duty is exempted on certain parts of Electric Vehicles

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