Major Direct tax proposals in the Budget 2023

Income Tax Budget 2023

• If the budget predictions for 2023 are accurate, the new taxation system will likely be made more attractive, which may also herald the demise of the previous tax system.
• This seems to be the unavoidable consequence of sweetening the new “concessional tax regime” by introducing a few restricted exemptions/tax deductions and/or increasing the ceiling for the basic exemption.
• EPFO Numbers doubled to 27 crores
• Agriculture accelerator fund to boost startup in Agri sector. Special scheme to boost fisheries
• 38,800 teachers will be employed in 3.5 lakh Eklavya tribal school.
• Capital outlay of Rs. 2.40 lakh crore for Railways.
• 50 New Airports and Heliports to be made.
• 10,000 crore for urban infra fund every year
• 75,000 crore for 100 transport infra projects
• 3 Centers of Excellence for “Artificial Intelligence” will be set up.
• More than 39,000 compliances reduced. Jan Vishwas Bill to amend 42 laws
• 35,000 crore for Energy transmission
• 10,000 bio input research centers to be set up.
• 30 Skill India International centers to be set up.
• NFIR (National Financial Information Registry) to be launched for financial strategy.
• Reducing cost of MSME Credit by 1%. Infusion of Rs. 9,000 crore in corpus for MSME credit.
• ‘Mahila Samman Bachat Scheme’ for Women for Rs. 2,00,000 @ 7.5%
• Senior Citizen Savings Scheme enhanced from 15 lakh to 30 Lakh.

Major Direct tax or indirect Tax proposals in the Income Tax Budget 2023

1. Rollout of next gen ITR form
2. New limit for 44AD & ADA : 3 crore & 75 Lacs
3. Expense deduction to MSME to be allowed on payment basis
4. New cooperatives manufacturing tax @ 15% if upto 31.03.24
5. Higher loan limit /cash deposit Rs 2 lacs for PAC society -RDB
6. Startups:

a) Date of incorporation for. start-up extended to 31.03.24

b) Extension of Carry forward Losses 7 yrs in case of change in shareholders

1. Selective scrutiny + More CIT to dispose off small appeals
2. Extension of tax benefits for IFSC
3. Personal Income tax

a) Tax rebate limit extended to 7 lacs (new regime): The rebate U/s 87A of new income regime hiked to INR 7,00,000/-

b) change in tax slabs & new tax rates

0-3 L : Nil

3-6 L : 5%

6L-9L : 10%

9L-12L: 15%

12-15 L : 20%

15L +: 30%

c) Salaried class & pensioners(incl family pensioners) : Standard deduction extended

d) Highest surcharge reduced from 37% to 25%

Now MMTR : 39%

e) Leave encashment exemption (pvt) increased from 3Lacs to 25 Lacs

f) New tax regime is now default tax regime -Old tax regime

g) Promote domestic manufacturing and exports.

h) Tax exemption on Capital Goods and Lithium batteries.

i) Mobiles, camera lenses to become cheaper.

J) Gold, Silver & Diamonds, cigarettes, imported rubber to get expensive.

h) Enhanced limit for 3 crore and 75 lakhs for presumptive taxation.

i) Higher TDS limit of RS. 3 cr for Cooperatives

J)New IT Return Form for easier filing .

K) 100 Joint Commissioners to be appointed for disposal of small appeals.

L) TDS reduced on EPF withdrawal

M) Section 54 and 54F to be amended.

N) Rebate limit increased to 7 lakh in new tax regime.

O) Number of slabs reduced from 7 to 5 in new tax regime.

P) Only 5% tax on Individual’s Annual income of 9,00,000 only to pay Rs. 45,000 as tax.

Q) Salaried class and pensioner: Standard Deduction increased

R) Highest tax rate 42.74 % reduced

S) Propose to reduced Higher surcharge rate from 37 % to 25% in new tax regime.

T) Leave Encashment: Limit increased from Rs. 3,00,000 to Rs. 25,00,000.

Mahila Samman Saving Certificate:

• Mahila Samman Saving Certificate, a one-time small savings programme, was introduced by Finance Minister Nirmala Sitharaman. The product will be offered for two years.
• The interest rate has been fixed at 7.5% P A. The ‘Mahila Samman Saving Certificate’ will have a maximum investment cap of INR 2,00,000/-
• There will also be an option for a partial withdrawal. New savings programme for women is announced by Finance Minister Nirmala Sitharaman.

Investment limit of Senior Citizen Savings Scheme increased

• Senior Citizen Savings Scheme: Maximum investment limit increased from Rs 15 lakh to Rs 30 lakh, announces. If income tax relief is given in new tax regime will old tax regime continue?

Digilocker will be the one stop KYC maintenance system for individuals

• We can simply update your address and identity documentation Via Digi Locker, As of present now, Digi Locker will serve as an individual’s one-stop KYC maintenance system, enabling you to make changes to documents that will be reflected in all of your documents linked to Digi Locker. Nirmala Sitharaman, the finance minister, declared in the Budget 2023, KYC procedure to be simplified. PAN to be come common business identifier. Scope of Digi locker to be increased.

PAN to be used as Common Business ID

• For business establishments required to have PAN, it will be used as a common identifier for all digital systems of specified government agencies, announces FM in Budget 2023.

Changes in Indirect tax via Budget 2023 :

GST में कुछ भी ख़ास नहीं है बजट में, बस Act में जो ग़लतिया थी, उसको सही गया है बस

• Section 17(5) में नया clause fa जोड़ा गया है, अब अगर कोई कंपनी CSR (Corporate Social Responsibility) पर कोई खर्चा करती है तो उसका Input उसको नहीं मिलेगा, इस input को block ITC में डाल दिया गया है
• Secrion 37 में नया sub section 5 insert करके ये कहा गया है की अब आप अपना GSTR 1 Due Date के 3 साल बाद फाइल नहीं कर सकते हो
• और यही Restriction Section 39 में भी दल दी गई है और अब GSTR 3B भी 3 साल बाद नहीं भरा जा सकता है
• और यही बात Section 44 में भी लिख दी गई है और आप अपना Annual Return भी Due Date के 3 साल बाद फाइल नहीं कर सकते हो अब
• Section 122 में एक नयी पेनल्टी जोड़ी गई है, अब E Commerce वाला अगर कोई URD से या कुछ और तरह की Supply लेगा तो उस E Commerce पर पेनल्टी लगेगी

Budget 2024 expectations: