Finance Minister Nirmala Sitharaman will present the Union Budget for 2023-24 in Parliament on February 1. The Budget is a statement of the government's estimated receipts and expenditures for a fiscal year (April 1 to March 31). It's divided into Revenue and Capital Budget. The Revenue Budget includes the government's revenue receipts and expenditures while the Capital Budget includes its capital receipts and payments.
The government has exempted units of investment trusts and ETFs issued by entities based in GIFT City or traded in exchanges there from capital gains tax. The Central Board of Direct Taxes (CBDT) notified the exemption from capital gains tax any unit of investment trust; a unit of a scheme; and a unit of an Exchange Traded Fund (ETF) launched under the International Financial Services Centres Authority (Fund Management) Regulations, 2022. Gujarat International Finance Tec-City (GIFT)-IFSC is being promoted as a tax-neutral enclave for the financial sector.
Financial and tax expert Anil Rego of Right Horizons has his doubts.
Ahead of the Union Budget 2023, insurers are hoping that the Centre will act on their recommendations, which includes increasing the limit for tax deduction under 80D of the Income Tax Act. Also among them are issuance of long-term bonds, tax incentives for home insurance premiums, and a separate section to claim deduction for term-insurance premium, among others. These suggestions would help improve the penetration of insurance in the country.
So tell us, does Sitharaman's 7th consecutive Budget deserve cheers or boos?
The National Pension System (NPS) added 21.5 per cent fewer fresh subscribers under the corporate segment in 2023 compared to the preceding year. Government officials and experts attribute it to the higher exemption limit of income tax of Rs 7 lakh announced in the FY24 Budget that no more requires employees under this income bracket to opt for NPS for tax-saving purposes. Data collated from the Ministry of Statistics and Programme Implementation (MoSPI) reveals that the corporate component is voluntary in nature and saw 158,212 new subscribers in 2023 compared to 201,517 during 2022.
The deportation of Indians from the United States, deaths in the Maha Kumbh stampede and the joint Parliamentary committee report on the Waqf bill were among the issues that led to heated exchanges and some disruptions in an otherwise smooth first part of the Budget session that ended on Thursday.
Only those who stick to the old I-T regime will get this benefit.
'Asset allocation should be driven much more by long-term factors rather than the market scenario at any particular point in time.'
The government has shown its efforts in phasing out the four-and-a-half-decade old Income Tax Act of 1961 with a new and 'taxpayer friendly' Code. The Code is designed to provide stability to the tax regime and is based on the accepted principles of taxation and best international practices.
P Chidambaram said tax rates that were announced in 1997 (in the Budget he had presented then), have remained and have survived four governments and four finance ministers.
The best solution would be the one followed in 2018 -- allow cost indexation until March 31, 2024 -- but exit at any time. The second-best alternative would be to allow time until March 31, 2025 for investors to exit their investments under the old indexation regime, points out Harsh Roongta.
There has been considerable discussion during the past few years about the Government changing from the EEE to EET Tax regime related to tax saving financial products. The acronyms have a simple expansion: Exempt -- Exempt -- Exempt and Exempt -- Exempt -- Tax. With the upcoming Budget expected to give some direction on this issue, its time we understood what these terms mean and their impact on our pockets.
Businesses across the country may soon be required to issue electronic invoices, or e-invoices, directly to consumers for the sale of goods and services. The Goods and Services Tax (GST) Council, in its forthcoming meeting on Monday, is expected to discuss extending the e-invoicing mandate to cover business-to-consumer (B2C) transactions. Currently, e-invoicing is compulsory for businesses with a turnover of Rs 5 crore and above, but only for their business-to-business (B2B) transactions.
India has earned the dubious distinction of being the country adding the maximum teeth to its tax regime since last year, says a study by Forbes.
Though the states might lose because of providing tax credit on input, they will also gain by way of taxing services. At present, only the Centre taxes around 100 types of services. Thus, the actual losses states might incur cannot be estimated until the GST is implemented.
The finance minister has stayed true to her commitment to fiscal consolidation, even though the pace of the decline in the deficit could have been faster, notes A K Bhattacharya.
Kerala Finance Minister K N Balagopal has sought systemic changes in the GST structure, saying every state and consumer has lost because of its basically flawed architecture that has also led to rampant revenue leakage for the states. The Goods and Services Tax (GST) regime came into force in July 2017. Even though the framework is focused on having a one-nation-one-tax model, quite a few items, including petroleum products and liquor are still out of the GST purview.
The new system would be especially beneficial for Qualified Foreign Investors.
"We are trying to bring the new taxation regime, which can last for another 50 years. Therefore, our endeavour is to see that new taxation system should include the basic features and time tested procedures of existing act, which have survived judicial security over the years."
Rising energy demand could tilt India's energy basket towards fossil fuels from coal to oil, natural gas.
'If I were in the Indian government, I would look at the growth projections in the next year. If it is a good and normal growth number, I would go for roll back.'
Equity benchmarks Sensex and Nifty ended on a mixed note on Wednesday as the euphoria about the Budget fizzled out, with investors going for profit-taking ahead of the Fed interest rate decision. The 30-share BSE benchmark Sensex climbed 158.18 points or 0.27 per cent to settle at 59,708.08 after it trimmed most of the intra-day gains. During the day, it had zoomed 1,223.54 points or 2 per cent to 60,773.44.
Annapoorna chain of restaurants owner Srinivasan is seen purportedly highlighting concerns over varying GST rates. In the second video, Srinivasan was seen purportedly apologising in person to the Finance Minister.
From second homes and AC rail travel to private tutors, astrologers and marriage-makers come under the tax net
Led by a new generation of entrepreneurs, India's family offices are shifting from traditional investments in physical and tangible assets like real estate to investing in technology, healthcare, and retail stocks. This new wave of family offices is engaging in stock market investments, including pre-IPO placements and secondary market operations. "Born into a world of technology, the next generation, especially those born after 2000, view technology as equally crucial as finance for running a business.
With the reality of coalition politics staring the BJP in its face, this was inevitable, points out Ramesh Menon.
'A mid-year review makes the end-of-year financial review manageable and less stressful.'
What stood out in his 15-year journey as a member of the political executive at the Centre was his glowing record as India's most successful and effective finance minister. Both as prime minister and finance minister, he understood the importance of gradualism, except when the economy or the polity was in a crisis.
Few finance ministers announce any taxation measure that could upset the stock market. Ms Sitharaman decided to take that risk, observes A K Bhattacharya.
Many senior citizens fail to disclose certain incomes like interest, commissions, or dividends in their ITRs.
There is a need to incentivise R&D investments, offer corporate tax concessions and establish an effective intellectual property rights regime in order to push the growth of domestic pharmaceutical industry, as per the industry bodies. Outlining the sector's wish list for the upcoming Union Budget, Organisation of Pharmaceutical Producers of India (OPPI) Director General Anil Matai urged the government to explore methods to incentivise R&D investments, such as deductions on R&D expenses, research-linked incentives for MNCs, and corporate tax concessions.
Recommendations on direct taxes vary from seeking cut in corporate tax, re introduction of standard deduction for salaried employees, removal of STT, DDT, etc.
In an attempt to bring uniformity in prices of medicines, Chemicals Minister Ram Vilas Paswan on Wednesday asked the states to exempt them from local taxes or at least advance the implementation of value-added tax regime for drugs.
With drought forcing the government to increase its spending, corporations and salaried individuals can expect a tougher tax regime, with Finance Minister Pranab Mukherjee revising this fiscal's direct tax collection target to Rs 4,00,000 crore from Rs 3,70,000 crore mentioned in the Budget last month.
The generation of quality jobs and skill development should be the focal point, cutting across ministries and departments, asserts Nivedita Mookerji.
The government should scrap the windfall profit tax on domestically produced crude oil as the levy is adversely impacting the capex-intensive exploration of oil and gas, the industry said in its recommendation for the forthcoming annual Budget. India first imposed windfall profit taxes on July 1, joining a growing number of nations that tax super normal profits of energy companies. At that time, a Rs 23,250 per tonne ($40 per barrel) windfall profit tax on domestic crude production was levied.
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