The Interim budget 2019-20 announced some big relief measures for homebuyers and developers. For the builders, the budget announced an additional one-year extension for the registration of affordable housing projects till FY20 u/s 80IBA as well as exemption from tax on the notional value of unsold inventory till 2 years from the end of the year in which the completion certificate is received. The budget also exempted homebuyers from paying tax on the notional value of the second self-occupied house property. Earlier only one house property was exempted, while notional rental income was taxable on the second one.
FM Piyush Goyal in his Budget 2019 speech has proposed to relax the conditions to claim exemption on capital gains from the sale of a residential property. The FM has proposed the benefit of rollover of capital gains u/s 54 of the I-T Act to be increased from investment in one residential house to two residential houses for a taxpayer having capital gains up to Rs 2 crore. This benefit can be availed once in a lifetime. Currently, the exemption u/s 54 is restricted to purchase or construction of one residential property.
FM Piyush Goyal, in his budget speech said the government has raised the ceiling limit for TDS u/s 194A on interest income from savings account to Rs 40,000 from the present Rs 10,000. The move is expected to benefit small depositors and house-wives. The deduction is available u/s 80TTA. The ceiling limit for TDS u/s 194I on House Rent has also been hiked to Rs 2,40,000 from the present Rs 1,80,000.
FM Piyush Goyal in his maiden budget speech announced a series of tax reliefs for middle-class taxpayers. In a move that will cheer the salaried class, the FM raised the standard deduction limit to Rs 50,000 from the present Rs 40,000. Currently, the benefit of standard deduction can be claimed both the salaried class and pensioners who receive pension directly from their previous employers. Goyal also announced hiking the tax free gratuity to Rs 30 lakh from existing Rs 20 lakh for employees having service of more than five years.
The government has raised the rebate under section 87A of I-T Act to Rs 12,500 from the existing Rs 2,500. For instance, if an assessee is having a gross income of Rs 6.5 lakh for the financial year 2019-20, and makes an investment of Rs 1.5 lakh under section 80C, his net taxable income would be Rs 5 lakh, with a tax payable of Rs 12,500 (5% of Rs 2.5 lakh). However, since his income is upto Rs 5 lakh, he will be eligible to claim 100% rebate of Rs 12,500 and thus net tax payable would be zero.
GST collection in January crossed Rs 1 lakh crore up from Rs 94,725 crore mopped up in December 2018. The collection collection was Rs 89,825 crore during the same month last year, Ministry of Finance said. The GST collection was higher despite measures to lower tax burden on consumers. The collection for December 2017 stood at Rs 86,703 crore. The overall GST revenue shortfall is nearly Rs 15,000 crore per month in the April-December period compared with the budget estimate for the current fiscal.
Based on the recommendation of the directorate general of trade remedies (DGTR), the government will not extend anti-dumping duty on imports of Chinese paracetamol, used in medicines. The finance ministry had first imposed anti-dumping duty on the product in 2002, then extended in 2007 and then again in October 2013 for five years. "The authority holds that domestic industry failed to provide any satisfactory evidence that the expiry of the said anti-dumping duty is likely to lead to continuation or recurrence of dumping and injury to the domestic industry," DGTR said in a notification.
Businesses will have option to include details of e-way bills generated while filing the final monthly sales return under GSTR-1. Matching of invoices of e-way bills with the sales data shown in GSTR-1 will help curb tax evasion and ascertain actual GST liability. The taxpayer can import data in his GSTR-1 form or import the same and use it with GSTR-1 offline tool to create his GSTR-1 Return Form," GST Network said. Officials have noticed that some transporters are doing multiple trips by generating a single e-way bill or not reflecting e-way bill invoices while filing GSTR-1.
The Mumbai wing of the income tax (I-T) department in its December 31 order against Sir Dorabji Tata Trust withdrew the exemption claimed by the trust under section 11 of the Income Tax Act. The case relates to the Rs 2.5 crore paid as salary to the managing trustee R Venkataramanan by the trust for the assessment year 2015-16. The I-T department held the payment as beyond the permissible limit allowed under section 13 of the Act. According to I-T sources, the trust would now have to pay taxes in accordance with the provision of section 13.
The Central Board of Indirect Taxes and Customs (CBIC) has imposed basic customs duty (BCD) of 5% and 10% on lithium ion cells and printed circuit boards respectively. The changes are effective from Wednesday, said the official notification. Both the items were not subject to BCD till now. Experts said the move was in line with the government’s ‘Make in India’ drive that aims to boost the domestic mobile handset manufacturing ecosystem.
A dealer of Patanjali Ayurveda has been held by the National Anti-profiteering Authority (NAA) for not passing on the benefits of duty reduction to his customers. The GST profiteering watchdog has asked the dealer to deposit Rs 6.06 lakh along with 18% interest with the Consumer Welfare Fund. Delhi-based Satya Enterprises had increased the base price of a product called Beauty Cream 50 GM by Patanjali after the GST rate on such products were lowered to 18% from 28%, to keep the MRP same as before.
The tax department has issued show-cause notices to banks that allow subsidiaries, such as mutual fund and insurance units, to use their logos for free. The tax department wants the banks to pay 18% GST on the “deemed” value of such transactions and has even calculated how much these are worth, sources said. SBI, Citibank, ICICI Bank, Bank of Baroda, Kotak Mahindra Bank and others have received show-cause notices. Subsidiaries use logos for the promotion of related products with the understanding that no fees have to be paid. The tax department says these are “related party transactions” chargeable to GST.
Foxconn, the world’s largest contract manufacturer, has raised concerns over delays in refunds of about Rs 1,000 crore under the GST regime. The company, in its address to the government, said that the inverted tax structure has resulted in a working capital crunch and threaten to disrupt the operations of one of its key India units due to cash constraints. Other contract manufacturers such as Wistron, which makes some iPhone models, Dixon and US-based Flex also face similar issues on refunds, totaling a combined Rs 2,500 crore, said Pankaj Mohindroo, president, Indian Cellular and Electronics Association of India (ICEA).
The I-T Department has confiscated benami assets worth Rs 6,900 crore till now, the agency said in a public advertisement on Tuesday. The message in the leading dailies added that furnishing false information under the Prohibition of Benami Property Transactions Act, 2016, may attract imprisonment up to 5 years besides being liable to pay fine up to 10% of fair market value of benami property. It also said that the benamidar and the beneficiary are also punishable with rigorous imprisonment up to 7 years and a penalty of up to 25% of the fair market value of benami property.
The Income Tax Department on Tuesday launched searches at 74 places in Tamil Nadu in connection with a tax evasion probe against some real estate groups and a retail store chain in the state, officials said. The raids are being carried out in Chennai and two places in Coimbatore against two realty groups and premises of retail chain Saravana stores, they said. A team of 70 tax officials are undertaking the operation with police assistance, they added.