HIGHLIGHTS OF UNION BUDGET 2013

HIGHLIGHTS OF UNION BUDGET 2013

TAX PROPOSALS

   P.SAIJAYRAM,

CELL: 9944896222

CA FINAL STUDENT,

ARTICLED ASSISTANT, PRABAKARAN ASSOCIATES,

YOUTH CO-ORDINATOR, SSSO,

MEMBER, SOUTHERN INDIA CHARTERED ACCOUNTANTS' STUDENT ASSOCIATION.

 

DIRECT TAXES:-

Ø  NO CHANGE IN THRESHOLD LIMIT AND NO CHANGE IN TAX SLAB RATES

Ø  CONCEPT OF REBATE IS INTRODUCED (ie) If the income is below Rs.500000/- Rebate of Rs.2000 is given.

Ø  ADDITIONAL DEDUCTION OF INTEREST UPTO RS. 100000/- FOR A PERSON TAKING HOME LOAN UP TO Rs. 25 LAKHS NOT EXCEEDING RS.40 LAKHS DURING THE FY 2013-2014. (CONDITION : THE ASSESSEE DOESNOT OWN ANY RESIDENTIAL HOUSE PROPERTY ON THE DATE OF SANCTION OF LOAN)

Ø  CONTRIBUTIONS MADE TO SCHEMES OF CENTRAL AND STATE GOVERNMENTS SIMILAR TO CENTRAL GOVERNMENT HEALTH SCHEME, ELIGIBLE FOR SECTION 80D OF THE INCOME TAX ACT.

Ø  SURCHAGE:-

·         FOR INDIVIDUALS, FIRMS , HUF AND ENTITIES WITH SIMILAR TAX  – 10% ON PERSONS WHO TAXABLE INCOME EXCEEDS Rs. 1 CRORE

·         FOR DOMESTIC COMPANIES – TO INCREASE FROM 5% TO 10% WHOSE TAXABLE INCOME EXCEEDS RS.10 CRORES *

·         FOR FOREIGN COMPANIES – TO INCREASE FROM 2% TO 5% IF THE TAXABLE INCOME EXCEED Rs.10 CRORES *

·         IN ALL THE OTHER CASES LIKE DIVIDEND DISTRIBUTION TAX OR TAX ON DISTRIBUTED INCOME, SURCHARGE INCREASED FROM 5% TO 10% *

·         *ADDITIONAL SURCHARGES TO BE IN FORCE FOR ONLY ONE YEAR.

Ø  TAX DEDUCTED AT SOURCE (TDS) AT THE RATE OF 1% ON TRANSFER OF IMMOVABLE PROPERTY (EXCEPT AGRICULTURAL LAND ) WHERE THE CONSIDERATION EXCEEDS Rs. 50 LAKHS.

Ø  THE RATE OF TAX INCREASED FROM 10% TO 25% ON PAYMENTS TO ROYALTY AND FEES FOR TECHNICAL SERVICES TO NON RESIDENTS.

Ø  TAX RESIDENCY CERTIFICATE (TRC) IN THE PRESCRIBED FORMAT WILL BE "A NECESSARY BUT NOT A SUFFICIENT CONDITION" FOR CLAIMING THE TAX TREATY BENEFITS.

Ø  "ELIGIBLE DATE" IN POWER SECTOR TO AVAIL BENEFIT UNDER SECTION 80  IA EXTENDED FOR ONE MORE YEAR (I.e.) Till 31-03-2014.

Ø  TO ATTRACT INVESTMENTS IN LONG TERM INFRASTRUCTURE BONDS  FROM NON RESIDENTS IN FOREIGN CURRENCY , TAX RATE HAS REDUCED FROM 20% TO 5%.

Ø  CONCESSIONAL RATEOF TAX OF 15% ON DIVIDEND RECEIVED BY AN INDIAN COMPANY FROM ITS FOREIGN SUBSIDIARY PROPOSED TO CONTINUE FOR ONE MORE YEAR.

Ø  NO DIVIDEND DISTRIBUTION TAX ON DOMESTIC COMPANY ON RECEIVING DIVIDEND FROM ITS FOREIGN SUBSIDIARIES.

Ø  PERMISSIBLE PREMIUM RATE TO CLAIM UNDER 80 C DEDUCTION HAS INCREASED FROM 10% TO 15% OF THE SUM ASSURED ON LIFE INSURANCE POLICIES FOR PERSONS SUFFERING FROM DISABILITY OR CERTAIN AILMENTS.

Ø  REDUCTION IN SECURITIES TRANSACTION TAX IN RESPECT OF CERTAIN TRANSACTIONS (STT) IN RESPECT OF CERTAIN TRANSACTIONS.

Ø  TO INTRODUCE COMMODITY TRANSACTION TAX (CTT) @ 0.01% ON TRANSACTIONS IN NON AGRICULTURAL COMMODITIES.

Ø  ALSO CATEGORISES BETWEEN FOREIGN DIRECT INVESTMENTS (FDI) AND FOREIGN INSTITUTIONAL INVESTMENTS(FII)

·         INVESTOR HAS STAKE OF 10% OR MORE IT IS TREATED AS FDI  (TAX RATE = 40% & LOCK IN PERIOD IS THEIR INVESTMENTS AS PROMOTORS 

·         INVESTOR HAS STAKE OF 10% OR LESS IT IS TREATED AS FII (TAX RATE = 30 %)

Ø  INVESTMENT ALLOWANCE AT THE RATE OF 15% TO A MANUFACTURING COMPANY INVESTING MORE THAN 100 CRORE IN PLANT AND MACHINERY OVER THE NEXT TWO YEARS HAVE BEEN AIMED AT INCENTIVISING INVESTMENT.

Ø  INCOME DISTRIBUTED BY THE SECURITIZATION TRUST :- TAX IS ATTRACTED ONLY AT THE TIME OF DISTRIBUTION ( 30 % FOR COMPANIES & 25%  FOR INDIVIDUALS OR HUF) AND NO FURTHER TAX WILL BE LEIVED.

INDIRECT TAXES-

Ø  SERVICE TAX:-

·         TO LEVY SERVICE TAX ON ALL AIR CONDITIONED RESTAURANTS.

·         VOCATIONAL COURSES OFFERED BY INSTITUTIONS AFFLIATED TO STATE COUNCIL OF VOCATIONAL TRAINING AND TESTING ACTIVITIES IN RELATION TO AGRICULTURE AND AGRICULTURE PRODUCE WILL EXEMPT FROM TAX.(i.e.) INCLUDED IN THE NEGATIVE LIST.

·         A ONETIME SCHEME CALLED "VOLUNTARY COMPLIANCE ENCOURAGEMENT SCHEME". A DEFAULTER MAY AVAIL OF THIS SCHEME ON THE CONDITION THAT HE FILES A TRUTHFUL DECLARATION OF SERVICE TAX DUES SINCE 01/10/2007.PENALTY AND INTEREST WILL BE WAIVED. THIS SCHEME HAS BOUGHT TO MOTIVATE PEOPLE TO PAY SERVICE TAX SINCE THERE ARE 17 LAKHS ASSESSEES AND ONLY 7 LAKH ASSESSESS FILE THEIR RETURNS PROPERLY.

·         EXEMPTION OF SERVICE TAX ON COPYRIGHT ON CINEMATOGRAPHY LIMITED TO FILMS EXHIBITED IN CINEMA HALLS.

 

Ø  EXCISE DUTY:-

·         EXCISE DUTY ON CIGRETTES, CIGARS , CHEROOTS AND CIGARILLOS IS INCREASED.

·         EXCISE DUTY ON SUVs INCREASED FROM 27 % TO 30% (WILL NOT APPLY IF SUVs REGISTERED AS TAXIS).

·         HANDMADE CARPETS AND TEXTILE FLOOR COVERINGS OF COIR AND JUTE TOTALLY EXEMPTED FROM EXCISE DUTY.

·         NO EXCISE DUTY ON SHIP BUILDING INDUSTRY, SHIPS AND VESSELS .

·         EXCISE DUTY ON MARBELS INCREASED FROM Rs. 30 per Square meter to Rs.60 per Square meter.

·         EXCISE DUTY ON MOBILE PHONES PRICED AT MORE THAN Rs.2000/- RAISED TO 6 PERCENT.

·         EXCISE DUTY TO LEVY 4% ON SILVER MANUFACTURED FROM SMELTING ZINC OR LEAD.

·         MRP BASED ASSESSMENT IN RESPECT OF BRANDED MEDICAMENTS OF AYURVEDA, UNANI, SIDDHA , HOMEOPATHY AND BIO CHEMIC SYSTEMS OF MEDICINE TO REDUCE VALUATION DISPUTES.

 

 

Ø  CUSTOMS DUTY:-

·         EXPORT DUTY ON DE-OILED RICE BRAN OIL CAKE WITHDRAWN

·         PERIOD OF CONCESSION AVAILABLE FOR SPECIFIED PART OF ELECTRIC AND HYBRID VEHICLES EXTENDED UPTO 31^ST MARCH 2015.

·         DUTY ON SPECIFIED MACHINERY FOR MANUFACTURE OF LEATHER AND LEATHER GOODS REDUCED FROM 7.5% TO 5%.

·         DUTY ON PREFORMS PRECIOUS AND SEMI PRECIOUS STONES REDUCED FROM 10%  TO 2%.

·         DUTY FREE GOLD LIMIT INCREASED FROM Rs. 50000/- IN CASE OF MALE PASSENGER AND RS.100000/- IN CASE OF A FEMALE PASSENGER SUBJECT TO CONDITIONS.

·         DUTY ON SET TOP BOXED INCREASED FROM 5 %  TO 10%.

·         EXPORT OF ILMENITE:-

§  UN PROCESSED = 10%

§  UN GRADED       =   5%

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