While presenting the Union Budget 2010, Finance Minister Pranab Mukherjee highlighted the requirement of constant Tax Reforms and presented some major tax proposals for individuals and firms.
Union Budget 2010 Tax Proposals
The highlights of tax proposed by Pranab Mukherjee in Union Budget 2010 are:
- Simplification of Tax Returns form and introduction of Saral-2 forms by the Income Tax Department for individual income tax payers.
- Sevottam project to be initiated in four Indian cities to facilitate a single window approach for both registration and complaint rectification. In addition four more registration cum grievance centres will be initated in four other cities along with two centres for bulk dealings of Tax Returns.
- To attain the rollout of Goods and Services Tax (GST), the Indirect Tax Administrations are being given a face-lift and an allowance of ` 1133 crore have been fixed for a mission mode scheme
- Tax concessions to be given to individual tax payers.
- Increase in tax exemption limit and reduction of tax slabs in different levels of personal earnings. Tax to be deducted at the rate of 30% on income earned above ` 8 lacs, 20% on earnings between ` 5 lacs to 8 lacs and 10% on earnings between ` 1.6 lacs to 5 lacs
- Reduction of an extra amount of ` 20000 for investing in lasting infrastructure bonds will be accessible along with the present value of ` 1 lakh for specific savings.
- The additional cost on domestic firms to be trimmed down to 7.5% against the existing 10%.
- Minimum alternate tax (MAT) to increase upto 18% against the existing 15%
- Tax exemptions and concessions have been proposed to enhance the expenditure on research and development
- To enhance investment in tourism industry, tax deductions have been extended on hotels falling under the category of two stars and above.
- Provisional tax relief has been offered to housing and realty sector in a bid to finish the awaiting projects within duration of five years against the previous duration of four years to asset a reduction on their profits earned.
- Moderate roll back of tax rate reduction in Central Excise tariffs and a 10% ad valorem increase in the usual tax rate on non-petroleum products against the existing 8%.
- Particular tax rates implemented on Portland cement and cement cinder are also being regulated with a balanced approach
- Central Excise tariffs on big cars, sports utility vehicles (SUVs) and multi-utility vehicles (MUVs) are hiked by 22% against the existing 20%.
- 5% of basic tax to be charged on crude petroleum, 10% on other advanced goods and 7.5% on diesel.
- Central Excise tariff on diesel and petrol is increased by ` 1 per litre.
- Excise tariff on non-smoking tobacco has been increased along with the introduction of composite tax plan on the basis of the competence of pouch manufacturing equipments.
- Tax concessions are proposed to assist the growth of agriculture and associated industries.
- Automatic handling systems in storehouses will be entitled to a development import recognition along with a tax concession of upto 5%
- Costs of sponsoring and installing of such machineries will be entirely excluded from service tax
- Concessional tariffs will be made relevant for food processing plants, specific apparatus for food conservation etc
- Experimenting and documentation of agricultural seed will be entirely excluded from service tax.
- The concessional import tariff on particular machinery for plantation use is extended upto the March 2011
- Tax exemptions on apparatus utilized in solar systems, mobile phone components, LED lights, etc.
- Continuation of service tax rates at 10%.
Last updated on : 15-05-2011
