Budget 2025 proposes Decriminalisation of Delayed TCS Payments

The Union Finance Minister, Nirmala Sitharaman, presented the Union Budget of 2025 before the parliament today at 11 pm. During the budget speech for 2025, the FM  proposed the decriminalization of delayed Tax Collected at Source ( TCS ) payments. 

The Finance Minister, in her speech, stated that the central government aims to decriminalize more offences. The FM declared that the delay in payment of TDS up to the due date of filing the statement was decriminalized during July last year. Sitharaman proposed to provide the same relaxation to TCS provisions as well.

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Thus, in short, the budget has proposed to relax penalties for delayed payments under the Tax Collected at Source ( TCS ) provisions, similar to the change made for Tax Deducted at Source ( TDS ) in July 2024. Under the new proposal, businesses will not face criminal charges for late TCS payments, as long as the payment is made before the due date for filing the relevant statement.

This introduction helps those especially those involved in large transactions, who may face minor delays in making TCS payments. Previously, such delays could lead to harsh penalties, including prosecution in some cases. By aligning the TCS provisions with the recent TDS reforms, the government seeks to make compliance less burdensome and more manageable for taxpayers.

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While this move is viewed as a step towards simplifying tax procedures and minimising wasteful litigation, experts emphasise the necessity of meeting payment deadlines, since interest will continue to be imposed on late payments. The reform reflects the government's continuous attempts to foster a more business-friendly climate while yet ensuring tax obligations are satisfied.

This is the eighth time the FM is presenting her budget, which is indeed a record for Indian FM. It is a much-highlighted fact that flexibility in policymaking is the need of the hour.

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The Finance Minister, in her speech, also stated that the central government aims to decriminalize more offences. The proposed Jan Viswas Bill 2.0 aims to decriminalize more than 100 additional provisions across various laws, reducing compliance burdens and promoting ease of doing business in India.

According to the FM, with the first quarter of the 21st century getting over, the Viksit Bhart, scheme is marching forward confidently.

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The main focus is being emphasised on taxational reforms. The major focus is on simplifying the tax structure to enhance compliance and reduce litigation. The minister also said that she will be presenting the new Income Tax Bill next week.

[BREAKING] No Income Tax up to Rs. 12 Lakh Income, proposes FM during Budget 2025

Read More: https://www.taxscan.in/breaking-no-income-tax-upto-rs-lakh-income-proposes-fm-during-budget-2025/485573/

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