Direct and Indirect tax changes in Indian Budget 2019

Aug 10, 2019

Mahesh Sharma, Chartered Accountant, has listed the following Direct and Indirect tax changes in Indian Budget 2019.

1. Direct tax revenue has increased to 11.37 lakh crores and there is no change in Income tax slabs.
2. Corporate Tax- Tax Rate of 25% on Companies with turnover of up to Rs. 400 crores. This will cover 99.3 % companies which further promotes entrepreneurship.
3. GST rate reduced on electric vehicle from 12% to 5% promoting the all transport electrification motive by 2025.
4. Tax deduction on loan taken for purchase of electric vehicle: Additional Income tax deduction of Rs. 1.5 lakh of interest on loan taken for purchase of electric vehicle.
5. Startup’s would not be under scrutiny by IT Department removing the needless hassles faced. Startups and investors who provide requisite documents will not be subject to angel tax assessment.
6. Additional deduction of Rs. 1.5 lakh for interest on loans borrowed under affordable housing.
7. STT change in case of Options purchased on Stock Exchange.
8. Aadhaar can be used in place of PAN for filing Income Tax Returns. Aadhaar cards to be issued to non-residents Indians with Indian passports after arrival in India without waiting for 180 days.
9. Faceless E-assessment for Income Tax Scrutiny and automated GST refund system initiated to curb the corrupt practices in the administration of taxes.
10. TDS of 2% on cash withdrawal exceeding Rs. 1 cr. from a Bank account per year.
11. No charges for customer on Digital modes of payment.
12. Surcharge on individuals having taxable income of Rs 2 crore to Rs 5 crore, and Rs 5 crore and more raised.
13. Basic customs duty on auto parts, optical fiber, digital camera, cashew, certain synthetic rubber, vinyl flooring hiked.
14. Customs duty exempted on components of specified electronic goods and customs duty on certain parts of electric vehicles removed.
15. Cess on petrol, diesel raised by Re 1 per litre; customs duty on gold raised to 12.5 percent from 10 percent.
16. A nominal basic excise duty imposed on tobacco- Proposes Legacy Dispute Resolution scheme to solve litigations in service tax and excise.