HIGHLIGHTS OF BUDGET
2015-16
|
Changes in Financial Market
|
Ø Public Debt
Management Agency (PDMA) bringing both external and domestic borrowings under
one roof to be set up this year.
Ø Enabling
legislation, amending the Government Securities Act and the RBI Act included in
the Finance Bill, 2015.
Ø Forward
Markets commission to be merged with SEBI.
Ø Section-6
of FEMA to be amended through Finance Bill to provide control on capital flows
as equity will be exercised by Government in consultation with RBI.
Ø Proposal to
create a Task Force to establish sector-neutral financial redressal agency that
will address grievance against all financial service providers.
Ø India
Financial Code to be introduced soon in Parliament for consideration.
Ø Vision of
putting in place a direct tax regime, which is internationally competitive on
rates, without exemptions.
Ø Government
to bring enabling legislation to allow employee to opt for EPF or New Pension
Scheme. For employee’s below a certain threshold of monthly income,
contribution to EPF to be option, without affecting employees’ contribution.
|
Improvement
Infrastructure
|
Ø National
Investment and Infrastructure Fund (NIIF), to be established with an annual
flow of `20,000 crores to it.
Ø Tax free
infrastructure bonds for the projects in the rail, road and irrigation sectors.
Ø Atal
Innovation Mission (AIM) to be established in NITI to provide Innovation
Promotion Platform involving academicians, and drawing upon national and
international experiences to foster a culture of innovation , research and
development. A sum of `150 crore will be earmarked.
Ø Self-Employment
and Talent Utilization (SETU) to be established as Techno-financial, incubation
and facilitation programme to support all aspects of start-up business. `1000
crore to be set aside as initial amount in NITI.
Ø Ports in
public sector will be encouraged, to corporatize, and become companies under
the Companies Act to attract investment and leverage the huge land resources.
Ø An expert
committee to examine the possibility and prepare draft legislation where the
need for multiple prior permission can be replaced by a pre-existing regulatory
mechanism. This will facilitate India becoming an investment destination.
Ø 5 new Ultra
Mega Power Projects, each of 4000 MW, in the Plug-and-Play mode.
|
Initiatives
for Agriculture sector
|
Ø Major steps
to address the two major factors critical to agricultural production, that of
soil and water.
Ø Paramparagat
Krishi Vikas Yojana’ to be fully supported.
Ø Pradhanmantri
Gram Sinchai Yojana’ to provide ‘Per Drop More Crop’.
Ø 5,300 crore
to support micro-irrigation, watershed development and the ‘Pradhan Mantri
Krishi Sinchai Yojana’. States urged to chip in.
Ø 25,000
crore in 2015-16 to the corpus of Rural Infrastructure Development Fund (RIDF)
set up in NABARD; `15,000 crore for Long Term Rural Credit Fund; `45,000 crore
for Short Term Co-operative Rural Credit Refinance Fund; and `15,000 crore for
Short Term RRB Refinance Fund.
Ø Target of
`8.5 lakh crore of agricultural credit during the year 2015-16.
Ø Focus on
improving the quality and effectiveness of activities under MGNREGA.
Ø Need to
create a National Agriculture Market for the benefit of farmers, which will
also have the incidental benefit of moderating price rises. Government to work
with the States, in NITI, for the creation of a Unified National Agriculture
Market.
|
Initiatives
to grab Black Money
|
Ø New
structure of electronic filing of statements by reporting entities to ensure
seamless integration of data for more effective enforcement.
Ø Bill for a
comprehensive new law to deal with black money parked abroad to be introduced
in the current session. ¾ Key features of new law on black money
Ø Evasion of
tax in relation to foreign assets to have a punishment of rigorous imprisonment
upto 10 years, be non-compoundable, have a penalty rate of 300% and the
offender will not be permitted to approach the Settlement Commission.
Ø Non-filing
of return/filing of return with inadequate disclosures to have a punishment of
rigorous imprisonment up to 7 years.
Ø Undisclosed
income from any foreign assets to be taxable at the maximum marginal rate.
Ø Mandatory
filing of return in respect of foreign asset.
Ø Entities,
banks, financial institutions including individuals all liable for prosecution
and penalty.
Ø Concealment
of income/evasion of income in relation to a foreign asset to be made a
predicate offence under Prevention of Money Laundering Act, 2002.
Ø Prevention
of Money Laundering Act, 2002 and Foreign Exchange Management Act 1999 to be
amended to enable administration of new Act on black money.
Ø Benami
Transactions (Prohibition) Bill to curb domestic black money to be introduced
in the current session of Parliament.
Ø Acceptance
or re-payment of an advance of ` 20,000 or more in cash for purchase of
immovable property to be prohibited.
Ø PAN being
made mandatory for any purchase or sale exceeding Rupees 1 lakh.
Ø Third party
reporting entities would be required to furnish information about foreign
currency sales and cross border transactions.
Ø Provision
to tackle splitting of reportable transactions.
Ø Leverage of
technology by CBDT and CBEC to access information from either’s data bases.
|
Changes in
Direct Tax
|
Ø Corporate
tax reduced from 30% to 25% over the next four years, starting from next
financial year.
Ø Wealth-tax
replaced with additional surcharge of 2 per cent on super rich with a taxable
income of over `1 crore annually.
Ø Domestic
transfer pricing threshold limit increased from `5 crore to ` 20 crore.
Ø Rate of
Income-tax on royalty and fees for technical services reduced from 25% to 10%
to facilitate technology inflow.
Ø Yoga to be
included within the ambit of charitable purpose under Section 2(15) of the
Income-tax Act
Ø General
Anti Avoidance Rule (GAAR) to be deferred by two years. GAAR to apply to
investments made on or after 01.04.2017, when implemented.
|
Changes in
Indirect Tax
|
Ø GST to be
put in place by April 1, 2016
Ø Excise
& Custom
·
Increase in basic custom duty:
a) Metallurgical
coke from 2.5 % to 5%.
b) Tariff rate
on iron and steel and articles of iron and steel increased from 10% to 15%.
c) Tariff rate
on commercial vehicle increased from 10 % to 40%.
·
Artificial heart exempt from basic custom duty of 5%
and CVD.
·
Excise duty exemption for captively consumed
intermediate compound coming into existence during the manufacture of
agarbathi.
·
Excise duty on sacks and bags of polymers of ethylene
other than for industrial use increased from 12% to 15%.
·
Excise duty on footwear with leather uppers and having
retail price of more than `1000 per pair reduced to 6%.
·
Online central excise and service tax registration to
be done in two working days.
·
Excise duty on chassis for ambulance reduced from 24%
to 12.5%.
|
Service Tax
|
Ø Service Tax
rate hiked to 14%, from 12.36%
Ø Service-tax
to be levied on service provided by way of access to amusement facility,
entertainment events or concerts, pageants, non recoganised sporting events
etc.
Ø Service-tax
exemption:
I.
Services of pre-conditioning, pre-cooling, ripening
etc. of fruits and vegetables.
II.
Life insurance service provided by way of Varishtha
Pension Bima Yojana.
III.
All ambulance services provided to patients.
IV.
Admission to museum, zoo, national park, wild life
sanctuary and tiger reserve.
V.
Transport of goods for export by road from factory to
land customs station.
Ø Service-tax
exemption to construction, erection, commissioning or installation of original
works pertaining to an airport or port withdrawn.
|
Benefits to
individual tax payers
|
Ø No change
in Basic Tax exemption limit and rate of tax
Ø Limit of
deduction of health insurance premium increased from `15000 to ` 25000, for
senior citizens limit increased from `20000 to `30000.
Ø Senior
citizens above the age of 80 years, who are not covered by health insurance, to
be allowed deduction of ` 30000 towards medical expenditures.
Ø Deduction
limit of ` 60000 with respect to specified decease of serious nature enhanced
to ` 80000 in case of senior citizen.
Ø Additional
deduction of `25000 allowed for differently abled persons.
Ø Limit on
deduction on account of contribution to a pension fund and the new pension
scheme increased from ` 1 lakh to `1.5 lakh.
Ø Additional
deduction of ` 50000 for contribution to the new pension scheme u/s 80CCD.
Ø Transport
allowance exemption hiked to Rs 1,600, from Rs 800 per month
Ø Payments to
the beneficiaries including interest payment on deposit in Sukanya Samriddhi
scheme to be fully exempt.
Ø Service-tax
exemption on Varishtha Bima Yojana.
Ø Service Tax
exemption extended to certain pre cold storage services in relation to fruits
and vegetables so as to incentivise value addition in crucial sector. ¾
Negative List under service-tax is being slightly pruned to widen the tax base.
Comments
Post a Comment