Let’s look into Tax Proposals in the Union Budget 2022-23

12 Feb Let’s look into Tax Proposals in the Union Budget 2022-23

Let’s look into Tax Proposals in the Union Budget 2022-23 – Today Current Affairs

The vision of the Budget 202-23 is to establish India as a trustworthy tax regime by bringing more reforms while continuing with the declared policy of a stable and predictable tax. The government in the Budget is hopeful that the proposals related to taxes and duties will promote voluntary tax compliance,  reduce litigation and will further simplify the taxation system. 

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In case of direct tax, the budget has permitted taxpayers to file updated income tax returns within 2 years for correcting errors. 

The persons with disability has been given tax relief

The alternative Minimum tax rate and surcharge for cooperative has been reduced

The period of incorporation for eligible startups has been extended by one year,  as an incentive for startups.

The tax deduction limit on employer’s contribution to NPS account of state government has been increased, to bring parity with central government employees

Under the new concessional tax regime the newly incorporated manufacturing entities will be incentivized. 

There will be a flat 30% tax on the income from transfer of virtual assets like cryptocurrency, Non-fungible tokens etc. 

The budget has also proposed better litigation management to avoid repetitive appeals 

On the Indirect tax side, the Union budget says that Customs administration in Special Economic Zones will be fully IT driven. The Hindu Analysis.

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It provides for phasing out of concessional rates in capital goods and project imports gradually and applying a moderate tariff of 7.5%. 

The budget underlines review of customs exemptions and tariff simplification, with more than 350 exemptions proposed to be gradually phased out. 

It proposes that customs duty rates will be calibrated to provide a graded structure to facilitate domestic electronics manufacturing. 

Rationalization of exemptions on implements and tools for agri sector manufactured in India will be undertaken. The Hindu Analysis.

Customs duty exemption to steel scrap will be extended. 

Unblended fuel will attract additional differential excise duty.

Important Tax Proposals : The Hindu Analysis

• Allowing taxpayers to file Updated Return within 2 years for correcting errors
• Tax relief to persons with disability
• Reducing Alternate Minimum Tax Rate and Surcharge for Cooperatives.
• Extending period of incorporation of eligible startups for providing tax incentives
• Income from transfer of virtual assets to be taxed at 30%
• Better litigation management to avoid repetitive appeals
• Increasing tax deduction limit on employer’s contribution to NPS account of state government employees
• Any Surcharge or Cess on Income and Profits not allowable as business expenditure
• Customs administration to be fully IT driven in SEZs
• Phasing out concessional rates in capital goods and project imports gradually and apply a moderate tariff of 7.5% 
• Review of customs exemptions and tariff simplification
• Customs duty rates are being calibrated to provide a graded rate structure to facilitate domestic electronics manufacturing
• Rationalization of exemptions on implements and tools for agri sector manufactured in India. Today Current Affairs.
  
• Extension of customs duty exemption to steel scrap
• Reduction of duty on certain inputs required for shrimp aquaculture
• Unblended fuel shall attract additional differential excise duty 

In this article we mention all information about Let’s look into Tax Proposals in the Union Budget 2022-23 – Today Current Affairs.

Md Layeeque Azam, Economics Faculty

MD. Layeeque Azam

Plutus IAS Current Affairs Team Member