budget-2017-impact-mergers-and-acquisitions

The finance minister has announced his government’s intention to go ahead with

  • Intention to abolish Foreign Investment Promotion Board (FIPB)
  • Consolidation various Oil & Gas manufacturing and distribution public sector companies.
  • To list various central, state and railway PSUs.
  • To make joint venture in real estate project easier by matching/delaying capital gain tax payment till completion of the project.
  • Change in holding period for land and building to 2 years in line with unlisted shares.
  • Increasing period for set off of MAT tax to 15 years.
  • Continuous of carried forward loss for start ups and small enterprises in spite of substantial change in share holding and management.

Other significant changes are

  • New law to confiscate assets of offenders who escape the country.
  • Issuance of electoral bonds for political funding.
  • Profit from affordable housing project exempt.
  • Longer time frame for start ups and small enterprises to set off losses incurred in first few years.
  • Deemed sale value for sale of unquoted shares introduced. To be taxed at fair value. Sec 50CA
  • In absence of PAN, the rate of TCS will be twice of the extent rate or 5%, whichever is higher. Sec.206CC.
  • New Section 269ST introduced whereby Rs three lakh in cash cannot be received on a single day or in respect of single transaction.
  • If Return not filed as per Sec. 139 (1), concept of late fee introduced. Rs. 5000 for delay up to 31st Dec. and Rs. 10000 thereafter. Late fee to be paid before filing the Return. Sec 234F.
  • CA issuing wrong certificate would be penalized with Rs. 10000.
  • Capital gain on shares will be exempt only if STT was paid while purchasing the shares.
  • HP loss can be setoff against other head of income only to the extent of 200000 in same year. Balance loss can be c/f to 8 A.Ys.
  • Individuals and HUF to deduct TDS even if unaudited @ 5% if rent is paid 50000.
  • TDS in 194J amended, now 2 percent TDS instead of 10%.
  • The scope of section 56 will be widened and will also cover any kind of gifts in cash or kind or for no consideration with few exemptions and exception.
  • MAT book profit calculation also amended.
  • Disallowance of expenditure from income from other sources if TDS is not deducted.
  • Self employed can also claim 20% contribution to NPS as deduction.

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