Budget Highlights :
1. Income Tax
A. Interest on House Loan Deduction – Section 80 EEA
It was increased by Rs. 1.5 Lakhs for Interest on home loan taken on self occupied property if,
i. Such Loan is taken before 31-03-2020.
ii. House with the cost of 45 Lakhs will be eligible.
B. Interest on Electric Vehicle Loan – Section 80 EEB
Additional deduction of Rs. 1.5 Lakhs for interest on loan taken to purchase electric vehicle & Custom Duty is Exempted on purchase of electric vehicle
C. Interchangeability of PAN and Aadhar for ease and convenience of taxpayers, Income Tax return can be filed using Aadhar Number
D. TDS on Cash Withdrawls – Section 194 N
To discourage cash payments TDS@ 2% on withdrawals exceeding Rs. 1Cr per annum from a bank account
E. Surcharge on Individuals
3% surcharge hike on an income of Rs. 2 crore and upto Rs.5 Crore; 7% on Rs. 5 Crore or above.
F. Securities Transaction Tax (STT)
STT restricted only to the difference between settlement and strike price in case of
exercise of options.
G. Corporate TAX
Tax rate reduced to 25% for companies with annual turnover up to Rs. 400 crore.
H. Relief for Start-ups
i. Capital gains exemptions from sale of residential house for investment in start-ups
extended till FY21.
ii. ‘Angel tax’ issue resolved- start-ups and investors filing requisite declarations and
providing information in their returns not to be subjected to any kind of scrutiny in
respect of valuations of share premiums.
iii. Funds raised by start-ups to not require scrutiny from Income Tax Department
iv. E-verification mechanism for establishing identity of the investor and source of
v. Special administrative arrangements for pending assessments and grievance redressal
vi. No inquiry in such cases by the Assessing Officer without obtaining approval of
the supervisory officer.
vii. No scrutiny of valuation of shares issued to Category-II Alternative Investment Funds.
viii. Relaxation of conditions for carry forward and set off of losses.
I. Section 35 AD deduction extended to Li-On battery, semi-conductor, Laptops, Fabrication & Photovoltaic cell
2. Indirect Taxes
Defence equipment not manufactured in India exempted from basic customs duty
B. Make In India
i. Basic Customs Duty increased on cashew kernels, PVC, tiles, auto parts, marble slabs,
optical fibre cable, CCTV camera etc.
ii. Exemptions from Custom Duty on certain electronic items now manufactured in India
iii. End use based exemptions on palm stearin, fatty oils withdrawn.
iv. Exemptions to various kinds of papers withdrawn.
v. 5% Basic Custom Duty imposed on imported books.
vi. Customs duty reduced on certain raw materials such as:
vii. Inputs for artificial kidney and disposable sterilised dialyser and fuels for nuclear
power plants etc.
viii. Capital goods required for manufacture of specified electronic goods.
C. Other Indirect Tax provisions
i. Export duty rationalised on raw and semi-finished leather
ii. Increase in Special Additional Excise Duty and Road and Infrastructure Cess each by Rs. 1 per litre on petrol and diesel
iii. Custom duty on gold and other precious metals increased
iv. Legacy Dispute Resolution Scheme for quick closure of pending litigations in Central
Excise and Service tax from pre-GST regime