The Budget 2021 took place against the backdrop of the global outbreak of COVID-19 wherein the Budget proposals for 2021-12 rest on six pillars health and well-being, physical and financial capital and infrastructure, inclusive development for aspirational India, reinvigorating human capital, innovation and R&D, Minimum Govt and Maximum Governance.
Here’re 15 of Taxation where the Govt delivered on Budget 2021.
Retrospective Amendment made by Finance Act, 2012 w.r.t taxation of indirect transfer of assets located in India nullified by Taxation Laws (Amendment) Act 2021 with the objective to reduce litigation, attract investment & bring certainty in tax policy.
The government reduced the time-limit for re-opening of assessment to 3 years from the present 6 years. In serious tax evasion cases too, only where there is evidence of concealment of income of `50 lakh or more in a year, can the assessment be re-opened up to 10 years. Even this reopening can be done only after the approval of the Principal Chief Commissioner, the highest level of the Income Tax Department.
The Government made the International Financial Services Centre (IFSC) in GIFT City a global financial hub. In addition to the tax incentives already provided, I propose to include, among others, tax holiday for capital gains for aircraft leasing companies, tax exemption for aircraft lease rentals paid to foreign lessors; tax incentive for relocating foreign funds in the IFSC; and to allow tax exemption to the investment division of foreign banks located in IFSC.
In order to ease compliance for the taxpayer, details of salary income, tax payments, TDS, etc. already come pre-filled in income tax returns. To further ease filing of returns, details of capital gains from listed securities, dividend income, and interest from banks, post office, etc. will also be pre-filled.
A new section 194P inserted in Income-tax Act,1961 provides senior citizens above the age of 75 years, having only pension & interest income from accounts maintained with bank in which they receive pension will be exempted from filing ITR.
In order to remove the genuine hardship faced by the NRIs in respect of their income accrued on foreign retirement benefit accounts.
In order to provide a transparent tax appellate mechanism, it is proposed to make the Income Tax Appellate Tribunal faceless and jurisdiction-less. A National Faceless Income- tax Appellate Tribunal Centre shall be established and all the communication between the Tribunal and the appellant shall be made electronically. Wherever personal hearing is needed, it shall be done through
The Faceless Appeals provide for a more efficient & transparent tax administration & enhanced taxpayer service. By 27.12.21, 62,604 appeals were disposed of in a faceless manner by NFAC. ITD has effectively leveraged technology for easing tax compliance for taxpayers.
The Taxpayers’ Charter while ensuring fair, courteous and rational behavior to the taxpayer on one hand also demonstrates our commitment to improve taxpayer services. The Taxpayers’ Charter was adopted by the CBDT as per the provisions of Section 119A of Income-tax Act, 1961. It reaffirms our commitment to providing a transparent and taxpayer friendly regime. It helps forge trust between the taxpayer and the Department.
In order to reduce compliance burden on the small charitable trusts running educational institutions and hospitals, it is proposed to increase the limit on annual receipts for these trusts from present Rs.1 crore to Rs.5 crore for non-applicability of various compliances like approval etc.
This Government sees ‘Housing for All’ and affordable housing as priority areas. In the July 2019 Budget, I provided an additional deduction of interest, amounting to Rs.1.5 lakh, for loan taken to purchase an affordable house. I propose to extend the eligibility of this deduction by one more year, to 31st March 2022. The additional deduction of `1.5 lakh shall therefore be available for loans taken up till 31st March 2022, for the purchase of an affordable house. Further, to keep up the supply of affordable houses, I propose that affordable housing projects can avail a tax holiday for one more year – till 31st March, 2022.
In order to incentivise setting-up of more start-ups in the country, extended the eligibility period to claim tax holiday for the start-ups by one more year to 31st March, 2022.
In order to incentivise investment in start-ups, it is proposed to extend the eligibility period of claiming capital gains exemption for investment made in the start-ups by one more year to 31st March, 2022.
For a USD 5 trillion economy, our manufacturing sector has to grow in double digits on a sustained basis. Our manufacturing companies need to become an integral part of global supply chains, possess core competence and cutting-edge technology. To achieve all of the above, PLI schemes to create manufacturing global champions for an AtmaNirbhar Bharat have been announced for 13 sectors. For this, the government has committed nearly Rs.1.97 lakh crores, over 5 years starting FY 2021-22. This initiative will help bring scale and size in key sectors, create and nurture global champions and provide jobs to our youth.
There has been a manifold increase in digital payments in the recent past. To give a further boost to digital transactions, earmarked Rs.1,500 crores for a proposed scheme that will provide financial incentive to promote digital modes of payment.
Around 1.68 crores farmers are registered and ` 1.14 lakh crores of trade value has been carried out through e-NAMs. Keeping in view the transparency and competitiveness that e-NAM has brought into the agricultural market, 1,000 more mandis will be integrated with e-NAM.
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