Finance Bill 2016 passed by Lok Sabha - No Rollback of Gold Excise
THE Lok Sabha yesterday passed the Finance Bill 2016, with no major changes or concessions.
The Finance Minister Arun Jaitley in his reply to the Budget Debate said,
Expenditure exceeds Estimates: Our total revenue for 2014-15 increased by 9.4 per cent. In the previous year this was about 17 per cent. For the first time in this year the actual expenditure exceeded the Budget estimates instead of being curtailed. The natural aim of the Government taxation policy is to take forward the Prime Minister's Make-in-India resolve. Hence, we make changes now and then to support domestic industry. Another aim is to increase employment in the country. To increase employment, we have given lots of rebates this time in the housing sector. Tax on royalty has been reduced to 10 per cent from 25 per cent. Relief has been given for 'Start Ups.' We are gradually moving towards rationalization of corporate tax to align it with globally competitive economies.
Minimum interaction between the Tax Department and the tax payers: The Government's effort is that there should be minimum interaction between the Tax Department and the tax payers. Last year Rs.2.10 crore refunds were effected electronically to gradually to do away with interactions. The appeals filed by the department lead to increase in litigation so our target is to bring it down by fifty percent. In all the three budgets of this Government so far, we have tried to put more and more money in the hands of the small taxpayers. For the first time the exemption limit U/s 80C regarding investment has been enhanced from Rs.1 lakh to Rs.1.5 lakh so that the more the people save less would be tax and the savings would contribute in the development of the country.
Pensioned society: The aim of the Government is to create gradually a pensioned society- not only for the Government servants but for others too. Hence, one would get additional exemption of Rs.50,000 for investment made in the National Pension Scheme. The Government has increased the exemption regarding house property from Rs.1 lakh to Rs.1.5 lakh. If the person is buying first house then additional exemption of Rs.50,000 can be availed by him. Additionally, taxpayers with income upto Rs.5 lakhs the deduction which was Rs.2,000 has been increased to Rs.5,000. For those living on rented properties the yearly exemption on rent is now Rs.60,000.
Presumptive income: The most important aspect I believe in this budget is that of presumptive income, done for the first time. There are a large number of professionals, architects, directors and self-employed persons in the country. They need not maintain any accounts. Simply a single page return needs to be filed while declaring their income. Similar facility has been extended to businessmen, traders and those running small workshops with yearly turnover upto Rs.2 crore.
Black Money: For the first time the Government has brought a law regarding declaration of foreign assets which need to be declared. Rs.6,500 crores were assessed in HSBC and Liechtenstein accounts. Large number of people came out with declaration under the black money law. Taxes were paid. Declaration was to the tune of Rs.4- 4.25 thousand crores. Last year, we unearthed black money in the normal procedure through assessment and indirect taxation measures led to Rs.71,000 crore of black money. Each individual whose name cropped up in the Panama list has been issued notice.
Tax Officers sacked: This year 33 taxation officials including 7 belonging to Group A were compulsorily retired. And, of the 72 dismissed from service, 6 belonged to Group A.
No Tax on Agriculture: Earning from agriculture is a state subject.
TDS on land compensation: Earning from agriculture is a state subject. Under the new Land Acquisition Law, there is no tax on acquisition of land and on land compensation. Even though there is no tax but here is a TDS provision of the Income Tax which applies. So, obviously, there is a conflict. We will try and resolve the anomaly.
No Rollback of Excise on Jewellery: There is no reason why there should be no tax on gold specially luxury goods. Earlier also I had assured the House we will not let anyone in this trade be harassed. They would have to pay one per cent tax on the quantum of VAT return. There would be no physical verification or inspection. To further simplify this, a Committee has been formed. Tax is levied on the primary manufacturer. This applies on the main retail big showrooms. Not on the job work. One has to understand the gold economy. The higher the custom duty the more the smuggling.