Summary of Tax Related Announcements in the Interim Budget 2024
Explore the latest tax-related updates from the Union Budget 2024-2025, presented by Finance and Corporate Affairs Minister Smt Nirmala Sitharaman. This summary delves into the significant tax measures announced on February 1, 2024, highlighting both direct and indirect tax implications.
Direct Taxes
Consistency in Tax Rates
The finance minister proposed no changes in the existing tax rates for both direct and indirect taxes, maintaining stability in the tax environment.
Withdrawal of Old Tax Demands
To enhance ease of living and doing business, outstanding direct tax demands up to Rs. 25,000 for the period up to FY 2009-10 and up to Rs. 10,000 for FY 2010-11 to 2014-15 will be withdrawn. This move is expected to benefit around one crore taxpayers.
Impressive Growth in Direct Tax Collections
Acknowledging taxpayer support, Sitharaman highlighted a threefold increase in direct tax collections over the last decade. The number of return filers has surged by 2.4 times during this period.
Tax Rationalization and Threshold Adjustments
The Minister emphasized the government’s efforts in rationalizing taxes, including an increase in the threshold for presumptive taxation for retail businesses and professionals over the years. Notably, there is no tax liability for individuals with income up to Rs. 7 lakhs.
Continued Support for Start-Ups and Investments
Tax benefits for start-ups and investments by sovereign wealth or pension funds have been extended until March 31, 2025. Additionally, tax exemptions on specific income for International Financial Services Centre (IFSC) units have been prolonged for the same duration.
Indirect Taxes
Stability in Indirect Tax Rates
The finance minister confirmed the retention of existing tax rates for indirect taxes and import duties, ensuring consistency in the indirect tax regime.
GST Impact
Sitharaman highlighted the positive impact of the Goods and Services Tax (GST), which has streamlined the fragmented indirect tax system in India. The GST tax base has doubled, and average monthly gross GST collections have nearly doubled to Rs. 1.66 lakh crore.
Industry Perception
A leading consulting firm’s survey revealed that 94% of industry leaders view the transition to GST as largely positive. The GST has optimized supply chains, reduced compliance burdens, and contributed to lower prices for goods and services, ultimately benefiting consumers.
Taxpayer Services and Achievements
Efficiency in Taxpayer Services
The finance minister highlighted the government’s commitment to improving taxpayer services. Notable achievements include a significant reduction in the average processing time of tax returns from 93 days in 2013-14 to just 10 days.
Faceless Assessment and Appeal
To enhance efficiency, the government has introduced faceless assessment and appeal mechanisms.
Conclusion
The Union Budget 2024-2025 reflects the government’s commitment to stability and continuity in taxation, with a focus on taxpayer-friendly measures and support for key sectors like start-ups. The announcements aim to further simplify the tax system, boost compliance, and foster economic growth.
To Download the Press Release on Budget 2024 Highlights CLICK HERE
To Access the Highlights of Budget 2024 on Direct & Indirect Taxes CLICK HERE
Also Read
Key Income Tax Exemptions Applicable to Salaried Individuals in FY 2023-24
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