Date : 2025-02-05 15:56:40

Property : budget speech summary tax reforms and key proposals by ca paras dawar vision and reforms for a developed india • the government aims to simplify taxation as part of its broader vision for vikasith bharat developed india • a new income tax bill will reduce the complexity of current laws featuring clearer and more concise provisions cutting both chapters and words by half • focus areas include good governance reduced litigation tax certainty and responsive policymaking guided by the principle of sabka saath sabka vikas tax price structure revisions 1 no tax on income up to rs 12 lakh • individuals earning up to rs 12 lakh annually rs 1 lakh price month will pay no income tax under the new tax regime • for salaried taxpayers due to the rs 75000 standard deduction this threshold is rs 1275 lakh 2 revised tax slabs and rates • 0 rs 4 lakh 0 % • rs 4 rs 8 lakh 5 % • rs 8 rs 12 lakh 10 % • rs 12 rs 16 lakh 15 % • rs 16 rs 20 lakh 20 % • rs 20 rs 24 lakh 25 % • above rs 24 lakh 30 % 3 tax rebates and benefits • taxpayers earning up to rs 12 lakh excluding special income like capital gains will receive a rebate resulting in zero tax payable • examples of benefits from the new regime • income rs 12 lakh rs 80000 tax benefit 100 % reduction from existing rates • income rs 18 lakh rs 70000 tax benefit 30 % reduction • income rs 25 lakh rs 110000 tax benefit 25 % reduction • these reforms aim to increase disposable income promoting household consumption savings and investments 4 revenue impact • an estimated rs 1 lakh crore in direct taxes and rs 2600 crore in indirect taxes will be foregone as a result of these proposals other major tax proposals 1 tds and tcs reforms • reduction in the number of tds rates and thresholds for simplification • increase in tax deduction limits • senior citizens interest deduction limit raised from rs 50000 to rs 1 lakh • tds threshold for rent payments increased from rs 24 lakh to rs 6 lakh annually • tcs threshold for remittances under rbis liberalized remittance scheme lrs increased from rs 7 lakh to rs 10 lakh • tcs exemption for educational remittances funded by loans from specified financial institutions • higher tds provisions to apply only to nonpan holders 2 voluntary compliance and updated returns • time limit for filing updated returns extended from 2 to 4 years • the government highlights the success of the updated return facility introduced in 2022 with nearly 90 lakh taxpayers voluntarily updating their incomes 3 charitable trusts and compliance relief • registration period for small charitable trusts extended from 5 to 10 years • provisions to prevent disproportionate penalties for minor compliance errors 4 property and transfer pricing reforms • taxpayers can now claim the benefit of two selfoccupied properties without conditions • introduction of a 3 year block period scheme for determining arms length pricing of international transactions • expansion of safe harbor rules to reduce litigation and provide tax certainty in international taxation 5 senior citizen benefits • exemption for withdrawals from national savings scheme nss accounts with no interest accrual after august 29 2024 • extension of similar benefits to nps vatsanya accounts 6 digitalization and dispute resolution • implementation of paperless digital processes for tax orders and appeals • the vivaat se vishwaas dispute resolution scheme has seen 33000 taxpayers settle disputes measures for investment and employment promotion 1 presumptive taxation for nonresidents • a new presumptive taxation scheme for nonresidents providing services to electronics manufacturing facilities in india 2 safe harbor for electronics manufacturers • tax certainty for nonresidents storing components for supply to electronics manufacturers 3 tonnage tax extension • extension of the tonnage tax scheme to inland vessels registered under the indian vessels act 2021 to promote inland water transport 4 startup ecosystem support • extension of startup benefits to companies incorporated before april 1 2030 by an additional five years 5 ifsc investment incentives • specific benefits proposed for ship leasing units insurance offices and treasury operations in the international financial services centre ifsc

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