Press Information Bureau 
Government of India
Ministry of Finance

09 JUL 2019

Extension of last date for filing IT returns

            Government has recently changed Form 16 and Form 24 Q to bring more disclosures.  In order to enable pre-filling of return of income of salaried taxpayers, the Government has amended Form No. 16 (certificate for tax deduction) and Form No. 24Q (quarterly statement of tax deducted) vide notification dated 12th April, 2019, to include more detailed information in these forms.

These forms, inter alia, provide for the following additional information: 

(i) Clause wise details of various allowances exempt under section 10 of the Income-tax Act, 1961 (“the Act”);

(ii) Amount of standard deduction;

(iii) Section wise details of deduction under Chapter VIA of the Act;

(iv) Details of rebate under section 87A of the Act;

(v) PAN of the lender, if the interest on housing loan is claimed under section 24(b) of the Act on loan taken from a person other than a Financial Institution or the employer.
The purpose of amendment in these forms was to reduce compliance burden of employers (since Form No 16 can now be downloaded online and there is common format of reporting), to enable pre-filling of income tax return forms (since the information sought in income tax return forms has now been aligned with the information in these forms) and to enable e-verification of various details in income tax returns. 

            Considering the practical difficulties of taxpayers, the due date for issue of Form No. 16 has already been extended from 15th June, 2019 to 10th July, 2019. 

            Representations have been received from certain quarters but, no specific proposal to extend the last date for filing IT returns for salaried class and others is under consideration at present.

This was stated by Shri Anurag Singh Thakur, Minister of State for Finance & Corporate Affairs in a written reply to a question in Lok Sabha today.

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Press Information Bureau 
Government of India
Ministry of Finance

05 JUL 2019

Stand-Up India Scheme extended till 2025

The Stand Up India Scheme has been extended upto the year 2025. This was stated by the Union Minister of Finance and Corporate Affairs, Smt Nirmala Sitharaman while presenting the Union Budget 2019-20 in the Parliament today. “Stand-Up India Scheme has delivered enormous benefits. The country is witnessing emergence of thousands of entrepreneurs from women and also from the Scheduled Castes and Scheduled Tribes, most of them assisted to set up their businesses and industry with capital provided under the Stand-Up India Scheme”, she said. The Minister said that banks will provide financial assistance for demand based businesses under this scheme, including for acquisition of scavenging machines and robots. 

The Finance Minister said that the Government also proposes to streamline multiple labour laws into a set of four labour codes which will ensure the standardisation and streamlining of the process of registration and filing of returns, which is further expected to reduce the disputes.

Highlighting the achievements of the Government in the field of skill development, the Finance Minister said that through the Pradhan Mantri Kaushal Vikas Yojana (PMKVY), the Government enables about 10 million youth to take up industry-relevant skill training. To prepare the youth for the future and also to take up jobs overseas, the Government will increase focus on skill sets needed abroad including language training, the Minister explained. She also added that focus shall be given to new-age skills like Artificial Intelligence (AI), Internet of Things, Big Data, 3D Printing, Virtual Reality and Robotics, which are valued highly both within and outside the country, and offer much higher remuneration. 

The Finance Minister, Smt. Nirmala Sitharaman said that under Pradhan Mantri Rojgar Protsahan Yojana (PMRPY), the Government contribution to the Pension Scheme has been increased from 8% in 2016-17 to 12% for both Employees Provident Fund and Employee’s Pension Scheme for all sectors w.e.f. 01.04.2018. As a result of this measure, number of beneficiaries increased by almost 88 lakhs during FY 2018-19. As on 31.03.2019, total beneficiaries under the Scheme are 1,18,05,000 and the establishments benefitting are 1,45,512. 

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Press Information Bureau 
Government of India
Ministry of Finance

05 JUL 2019

Union Budget proposes creation of a social stock exchange- under the regulatory ambit of Securities and Exchange Board of India (SEBI) for listing social enterprises and voluntary organizations

Creation of a social stock exchange has been proposed by the Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman, while presenting the Union Budget 2019-20 in Parliament today.

The Finance Minister said that it is time to take our capital markets closer to the masses and meet various social welfare objectives related to inclusive growth and financial inclusion. The Minister further stated that “I propose to initiate steps towards creating an electronic fund raising platform – a social stock exchange - under the regulatory ambit of Securities and Exchange Board of India (SEBI) for listing social enterprises and voluntary organizations working for the realization of a social welfare objective so that they can raise capital as equity, debt or as units like a mutual fund”.

The Finance Minister added that it is important to get retail investors to invest in treasury bills and securities issued by the Government. Efforts made by the Reserve Bank will need to be supplemented with further institutional development using stock exchanges. For this purpose, inter-operability of RBI depositories and SEBI depositories would be necessary to bring about seamless transfer of treasury bills and government securities between RBI and Depository ledgers and for enabling this. The Government will take up necessary measures in this regard in consultation with RBI and SEBI.

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Press Information Bureau 
Government of India
Ministry of Finance

05 JUL 2019

Tax rates for individuals having taxable income from Rs. 2 cr - 5 cr and Rs. 5 cr & above to be increased by around 3 % and 7 % respectively

The effective tax rates for the higher income group individuals having taxable income from Rs. 2 crore to Rs. 5 crore and  Rs. 5 crore and above is proposed to be increased by around 3 percent and 7 percent  respectively. Presenting the General Budget 2019-20 in the Parliament today, Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman said, “In view of rising income levels, those in the highest income bracket need to contribute more to the Nation’s development”. Thanking the taxpayers, she said that they are playing a major role in Nation building.

Referring to several measures taken in the past to alleviate the tax burden on small and medium income earners, the Minister said, “Those having annual income upto Rs. 5 lakh are not required to pay any income tax”. This includes self-employed as well as small traders, salary earners, and senior citizens, she added.

Tax Revenue Up

Due to slew of efforts taken by the Government, the direct tax revenue has significantly increased by over 78 percent from Rs. 6.38 lakh crore in Financial Year 2013-14 to around Rs. 11.37 lakh crore in Financial Year 2018-19. The Minister stated that the increase has been significant in last couple of years. The Direct Tax revenue grew by 19.13 percent to Rs. 10, 02, 741 crore in 2017-18 (Rs. 8, 41, 713 crore in 2016-17) and by 13.46 percent in 2018-19. The number of taxpayers also increased by approximately 48 percent over the period 2013-14 to 2017-18, from 5.71 crore taxpayers to 8.4 crore taxpayers, due to various initiatives and taxpayer outreach programmes undertaken by the Government.

Relief in Levy of Securities Transaction Tax (STT)

In her speech, the Finance Minister proposed to give relief in levy of Securities Transaction Tax by restricting it only to the difference between settlement and strike price in case of exercise of options.

Additional Deduction of Interest for Affordable Housing

In order to provide a further impetus to affordable housing, the Minister proposed to allow an additional deduction of up to Rs.1,50,000/- for interest paid on loans borrowed up to 31^st March, 2020 for purchase of an affordable house valued up to Rs. 45 lakh. Therefore, a person purchasing an affordable house will now get an enhanced interest deduction up to Rs. 3.5 lakh. This will translate into a benefit of around Rs.7 lakh to the middle class home-buyers over their loan period of 15 years.

For realisation of the goal of ‘Housing for All’ and affordable housing, a tax holiday has already been provided on the profits earned by developers of affordable housing. Also, interest paid on housing loans is allowed as a deduction to the extent of Rs. 2 lakh in respect of self-occupied property.

Promoting Electric Vehicles

To make Electric Vehicles affordable to consumers, the Minister said that the Government will provide additional income tax deduction of Rs. 1.5 lakh on the interest paid on loans taken to purchase electric vehicles. This amounts to a benefit of around Rs. 2.5 lakh over the loan period to the taxpayers who take loans to purchase electric vehicle. Considering India’s large consumer base, the she stated, “We aim to leapfrog and envision India as a global hub of  manufacturing of Electric Vehicles. Inclusion of Solar storage batteries and charging infrastructure in the above scheme will boost our efforts”. The Government has already moved GST council to lower the GST rate on electric vehicles from 12% to 5%, she added.

Level Playing Field for Non Banking Financial Companies (NBFCs)

Recognising the increasingly important role of NBFCs in India’s financial system and to provide level playing field, the Finance Minister has proposed to tax the interest on bad or doubtful debts in the year in which it is actually received. Presently this is allowed for scheduled banks, public financial institutions, state financial corporations, state industrial investment corporations, cooperative banks and certain public companies like housing finance companies.

Measures to promote the International Financial Services Centre (IFSC)

To promote IFSC in GIFT City, the Finance Minister proposed to further provide several direct tax incentives to an IFSC including 100 percent profit-linked deduction under section 80-LA in any ten-year block within a fifteen-year period, exemption from dividend distribution tax from current and accumulated income to companies and mutual funds, exemptions on capital gain to Category-III AIF and interest payment on loan taken from non-residents.

Compulsory Filing of Return

The General Budget 2019-20 proposes to make return filing compulsory for persons, who have deposited more than Rs. 1 crore in a current account in a year, or who have expended more than Rs. 2 lakh on foreign travel or more than Rs. 1 lakh on electricity consumption in a year or who fulfils the prescribed conditions, in order to ensure that persons who enter into high value transactions also furnish return of income. It is also proposes to provide that a person whose income becomes lower than maximum amount not chargeable to tax due to claim of rollover benefit of capital gains shall also be required to furnish the return.

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Press Information Bureau 
Government of India
Ministry of Finance

05 JUL 2019

Lower rate of 25 % Corporate Tax extended to companies with Annual Turnover up to  Rs. 400 crore from earlier cap of upto Rs 250 crore

The Union Budget 2019-20 has proposed to extend the lower rate of 25 % Corporate Tax to all companies with annual turnover up to Rs. 400 crore.  Currently, this rate is only applicable to companies having annual turnover up to Rs. 250 crore. Presenting the General Budget 2019-20 in the Parliament today, the Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman said, “This will cover 99.3 percent of the companies. Now only 0.7 percent of companies will remain outside this rate”.   

PAN – Adhaar Interchangeability proposed

The Budget also proposes to make PAN and Aadhaar interchangeable and allow those who do not have PAN to file Income Tax Returns by simply quoting their Aadhaar number and also use it wherever they are required to quote PAN. The Finance Minister said that more than 120 crore Indians now have Aadhaar and the proposal aims at ease and convenience of tax payers.

Pre-filling of Income-tax Returns

The Finance Minister said that pre-filled tax returns will be made available to taxpayers which will contain details of salary income, capital gains from securities, bank interests, and dividends etc. and tax deductions. She further said that Information regarding these incomes will be collected from the concerned sources such as Banks, Stock exchanges, mutual funds, EPFO, State Registration Departments etc. “This will not only significantly reduce the time taken to file a tax return, but will also ensure accuracy of reporting of income and taxes”, the Minister added. 

Faceless e-assessment to eliminate undesirable practices

In her speech, the Finance Minister said that the existing system of scrutiny assessments in the Income-tax Department involves a high level of personal interaction between the taxpayer and the Department, which leads to certain undesirable practices on the part of tax officials. To eliminate such instances, and to give shape to the vision of the Prime Minister, the FM said that a scheme of faceless assessment in electronic mode involving no human interface is being launched this year in a phased manner. To start with, such e-assessments shall be carried out in cases requiring verification of certain specified transactions or discrepancies, she added.

The Finance Minister further said that the cases selected for scrutiny shall be allocated to assessment units in a random manner and notices shall be issued electronically by a Central Cell, without disclosing the name, designation or location of the Assessing Officer. “The Central Cell shall be the single point of contact between the taxpayer and the Department. This new scheme of assessment will represent a paradigm shift in the functioning of the Income Tax Department”, she said in her speech.

Slew of Measures to Encourage Digital Payments

The Budget also proposes to levy TDS of 2 percent on cash withdrawal exceeding Rs. 1 crore in a year from a bank account. This is in continuation of a number of initiatives taken in the recent past for the promotion of digital payments and less cash economy, and to promote digital payments further, said the Minister.

The low-cost digital modes of payment such as BHIM UPI, UPI-QR Code, Aadhaar Pay, certain Debit cards, NEFT, RTGS etc. will promote less cash economy. The Finance Minister proposed that the business establishments with annual turnover more than Rs. 50 crore shall offer such low cost digital modes of payment to their customers and no charges or Merchant Discount Rate (MDR) shall be imposed on customers as well as merchants. She added, “RBI and Banks will absorb these costs from the savings that will accrue to them on account of handling less cash as people move to these digital modes of payment”.

Simplification and Ease of Living

Noting that India’s Ease of Doing Business ranking under the category of ‘paying taxes’ showed a significant jump from 172 in 2017 to 121 in the 2019, the Finance Minister said above measures will leverage technology to make compliance easier for the taxpayers.

The Budget also proposes to simplify the tax law to reduce genuine hardships to taxpayers which include enhancing threshold of tax for launching prosecution for non-filing of returns from Rs. 3,000 to Rs. 10,000, for proceeding against a person and exempting appropriate class of persons from the anti-abuse provisions of section 50CA and section 56 of the Income Tax Act.

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