Taxation policy of Budget 2021-22
At the individual level.
• There has been less to no change in the income tax rates
Less than 2.5L p.a - Nil
2.5L - 5L - 5%
5L - 7.5L - 10%
7.5L - 10L - 15%
10L -12.5L - 20%
12.5L -15L - 25%
Above 15L - 30%
• Time limit for filing belated or revised returns curtailed by 3 months
• Tax liability to be arised only after declaration or payment of dividend to attract FPI.
• Deduction of tax rates on dividend income
• Employees Provident Fund or EPF interest income above 2.5 Lakhs will be taxable
• Interest income from PF contribution above 2.5 lakhs/year will be taxed.
• GST relief by reducing inverted GST structures
• Sparing retired NRIs from double taxation on their accrued income.
• Citizens above 75 years of age receiving pension and interest income aren't required to file ITR. The paying bank will deduct the necessary tax on their income.
Regarding tax incentives.
• Citizens above 75 years of age receiving pension and interest income aren't required to file ITR.
The paying Bank will deduct the necessary tax on their income.
• Tax Holiday for affordable housing projects and notified affordable rental housing projects along with for start ups extended till 31st March 2022.
• Tax holiday for capital gains from the income of aircraft leasing companies.
• Tax exemption for aircraft lease rentals paid to foreign lessors.
• Tax exemption for investment division of foreign banks in IFSC.
• Tax incentives for relocating foreign funds in IFSC.
• Tax exemption on maturity of ULIP ( Unit Linked Insurance Plan ) having annual premium upto 2.5 lakhs.
• Employees to avail exemption for leave travel concession of one-third of specified expenditure of Rs 36000, whichever is less for the block of 2018-21.
Additional Incorporations
• Tax Audit limit has increased from Rs 5 crore to Rs 10 crore
• The re-opening window for IT assessment cases is reduced from 6 years to 3 years. In serious tax evasion cases ( taxable income more than 50L or more ), however, it can go upto 10 years.
• Formation of Dispute Resolution Committee for small taxpayers facing litigations ( Taxable income less than 50L )
• Setting up of National Faceless Income Tax Appellate Tribunal Centre.
• Details of capital gains from listed securities, dividend income and interest from banks and post offices will be pre-filled in returns.
Custom duty
• Copper scrap @2.5%
• Solar inverter @20%
• Solar Lanterns @15%
• Cotton @10%
• Tunnel Boring Machine @7%
• Nylon Products @5%
• Some parts of mobiles will move from “NIL” rate to a moderate 2.5 per cent.
• 7.5 per cent on semis, flat, and long products of non-alloy, alloy and stainless steel.
• Steel screws, plastic builder wares and prawn feed @15%
• Raw silk and silk yarn @15%.
• 10 percent on wet blue chrome tanned leather, crust leather, finished leather of all kinds, including splits and sides.
