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Policy Updates
- Comprehensive review of the FEMA (Non-debt Instruments) Rules, 2019 proposed
- FPI/PROI investment limit in listed equities raised from 5% to 10%.
- High Level Committee on Banking for Viksit Bharat to be set-up for comprehensive review of the sector
- Three-pronged approach introduced for MSME
- Several policy and tax measures emphasising on services sector growth introduced
- Several initiatives for large-scale enhancement of public infrastructure proposed
Personal Tax
- No Changes in personal tax slabs and rates
- Simplification of certain TDS provisions and reduction of TCS rates on overseas tour packages and certain LRS remittances
Other Direct Tax Proposals
- Tax Holiday window for Gift CityIFSC units extended to 20-years (from 10 years) within a 25-year window. Post tax holiday, concessional tax rate of 15% to apply
- Deadline to revise tax returns extended to 31 March, with a small fee
- Decriminalization of offences and rationalization of penalties
Other Direct Tax Proposals
- Retrospective immunity from prosecution for foreign asset non-disclosure (other than immovable assets) up to Rs. 20 lakh under the Black Money Act
- One-time disclosure window introduced for certain foreign income/assets in case of small tax payers
- Assessment and penalty proceedings integrated into a single order
- Taxpayers allowed to file updated returns even after initiation of reassessment
- Tax benefits introduced for IT/ITeS, including wider safe harbour norms and fast-tracked APAs.
Customs Proposals
- AEO accreditation to be used as the core eligibility criterion for major procedural benefits.
- For ensuring a non-adversarial and taxpayer-friendly framework, the penalty shall now be deemed to be a 'charge'.
- The validity period of Advance Rulings has been extended from 3 years to 5 years.
- Further simplification of tariff structures to minimise classification disputes.
- Eligible SEZ units permitted to supply goods to DTA importers at concessional rates
- Customs Integrated System (CIS), a single/integrated platform to be introduced for all customs processes
GST Proposals
56th GST Council meeting recommendations implemented
- Place of supply for intermediary services to be based on the location of the recipient.
- Provisions relating to the issuance of credit notes for discount aligned
- Benefit of provisional refunds to exporters extended to IDS refunds. Will release working capital blockage.
- Existing authorities (incl. Tribunals) to be empowered to hear matters of the National Appellate Authority for Advance Rulings
Corporate Tax
- No changes in Corporate Tax Rates. Restriction on accumulation of MAT Credit from April 1, 2026; MAT rate cut to 14%
- Existing MAT credit can be used (up to 25% of tax liability) by companies opting for the new tax regime
- Tax exemptions/holidays for foreign companies and non-residents for businesses like data centers and supply of capital equipment for electronics etc
- Share buy-backs to be taxed as capital gains, with additional tax on promoters
- Proposal to merge ICDS with IND AS
Expected scenarios that did not unfold
- Tax neutrality for fast-track demerger
- Inclusion of capital gains in the 87A rebate (Rs. 12 lacs) & Reduction in STT
- Clarification on family investment funds in Gift City
- Clarity on Grandfathering for concluded assessment post ruling of Supreme Court in case of Tiger Global
- Pillar 2 announcements
- Customs and GST Amnesty Scheme for settlement of disputes
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