Monday 1 April 2013

Budget 2013-14

Union Budget (2013-2014)
We are presenting herewith a synopsis of the union budget to apprise the reader with the impacts of the proposed amendments. Though, our team have briefed the relevant amendments, you may ask us for any further clarification or query.

Income Tax

  • Tax Savings of Rs. 2000 for assessee having taxable income upto Rs. 5 Lakhs
  • Additional deduction of interest upto Rs. 1 Lakhs for person taking home loan(not exceeding Rs. 25 Lakhs) for their first home(not exceeding Rs. 40 Lakhs) during the period 01-04-2013 to 31-03-2014
  • 10% Surcharge on Individual, HUF, Partnership firms  if the taxable income exceeds Rs. 1 Crores
  • 10% Surcharge on domestic Companies if the taxable income exceeds Rs. 10 Crore. (5%  - Surcharge if the taxable income exceeds Rs. 1 Crore) – Valid only for 1 year
  • 5% Surcharge on foreign Companies if the taxable income exceeds Rs. 10 Crore. (2% Surcharge if the taxable income exceeds Rs. 1 Crore) - Valid only for 1 year
  • Surcharge on Dividend Distribution Tax etc increased from 5% to 10%
  • Concessional rate of 15% tax on dividend received by an Indian Company from its foreign subsidiary proposed to continue for more than 1 year. No dividend distribution tax on domestic company on receiving dividend from its foreign subsidiaries
  • Investment allowance of 15% for companies investing Rs. 100 Crore or more in plant and machinery during 01-04-2013 to 31-03-2015
  • STT Reduced on Equity Futures/ MF Units.
  • Commodity transaction tax introduced on non-agricultural commodities futures contracts
  • GAAR Provisions applicable from 01-04-2016
  • Land & building held as stock in trade cannot be sold below the stamp duty valuation for the purpose of Income Tax.
  • 1% TDS on the value of the transfer of immovable property (except agricultural land) where the consideration exceeds Rs. 50 Lakhs
  • Gross Total Income Limit under Rajiv Gandhi Equity Savings Scheme has been increased from 10 Lakhs to 12 Lakhs which shall be allowed for three consecutive assessment years.
  • Final withholding tax @ 20% on profits distributed by unlisted companies to shareholders through buyback of shares
  • Rate of tax on payments by way of royalty and fees for technical services to non-residents has been increased from 10 % to 25% - Subject to DTAA

Service Tax


  • All AC restaurants(Whether serving Alcohol or not) are subjected to Service Tax
  • Service Tax to be charged on Vehicle Parking fees
  • All kinds of testing in relation to agriculture or agricultural produce shall be exempt from the charge of Service Tax
  • Courses approved by the State Council for Vocational Training shall also be exempt from the charge of Service Tax
  • Service Tax exemption on copyright on cinematography limited to films exhibited in cinema halls.
  • Abatement reduced from 75% to 70% for construction other than residential properties having a carpet area upto 2000 Sqft or where the amount charged is less than Rs. 1 Crore.
  • If a show cause notice is issued after invoking the extended period of limitation i.e 5 years but the charge of evasion is not established, the notice will continue to be valid for 18 months.
  • Penalty for failure to take Service Tax Registration  - upto  Rs. 10000
  • Penalty on Director or officer of the company for specified offences - upto Rs. 100000
  • Offices granted Power to arrest in specified cases.
  • Voluntary Compliance SchemeNo Penalty or Interest- for returns not filed or wrongly filed during the period 01-10-2007 to 31-12-2012. Not applicable to the persons against whom any inquiry or investigation is pending


Excise

  

  • Exemption from Excise Duty – Cotton at fibre stage, Handmade Carpets, Textile floor coverings of coir and jute.  In case of spun yarn made of manmade fibre – 12% at fibre stage
  • Specific Excise Duty Increased on Cigarettes, Cigars, Cheroots, Cigarillos
  • Excise Duty increased on SUV(Except those registered as taxis) from 27% to 30%
  • Excise Duty increased on Marble – Rs. 30/Sqm to Rs. 60/Sqm
  • Excise duty of 4% imposed on silver produced or manufactured during the process of zinc/lead smelting
  • Compounded duty rate on stainless steel patta-patti increased from Rs. 30000 per machine per month to  Rs. 40000 per machine per month
  • Excise duty increased on mobile phones (Pricing above Rs. 2000) from 1% to 6%
  • MRP based assessment for branded medicaments of Ayurveda, Unani, Siddha, Homeopathy and bio-chemic systems of medicines

Customs


  • No export duty on de-oiled rice bran oil cake, Raw/white/refined Sugar, Flat rolled iron products plated/coated with Zinc
  • Duty free jewellery allowed from abroad in case of gentleman - Rs. 50000, in case of Lady – Rs. 100000.
  • BCD (Basic Custom Duty) Increased on set Top boxes  from  5% to 10%
  • BCD Increased on Raw Silk from 5% to 15%
  • BCD Increased on Motor vehicles (Cars) with CIF value more than $ 40000 or more than 3000cc/2500cc from 75% to 100%
  • BCD Increased on Old cars from 100% to 125%
  • BCD Increased on Motorcycles having capacity of 800cc or more from  60% to 75%
  • BCD reduced on specified machinery for manufacture of leather and leather goods including footwear from 7.5% to 5%
  • BCD reduced on Hazel Nuts from 30% to 10%
  • BCD reduced on De-Hulled Oat Grain from 30% to 15%
  • BCD reduced on Pre forms of Precious/ Semi-precious stones  from 10% to 2%

CA Rahul Jain
+91-9811613999

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