INCOME TAX
• There are no specific changes in basic rates of taxation on income for all categories of the assessee
• New section 139 (8A) is proposed which will allow taxpayers to file Updated Return within 2 years for correcting
errors or omissions by making payment of additional tax as described under new Section 140B
• Retrospective clarification from 1st April 2005, that any surcharge or cess on income and profits is not
allowable as business expenditure
• Tightening the requirement of two years windows to one year by amending sections 206AB and 206CCA in
relation to “specified person”
• Reduce the surcharge on co-operative societies from 12% to 7 % for those having
total income of more than 1 crore and up to 10 crores
• Surcharge on Long Term Capital Gains on the transfer of any type of asset to be capped at 15%.
• Alternate Minimum Tax (AMT) to be reduced to 15% for co-operative societies
• Virtual Digital Asset (VDA) (Crypto-Currency):
- a virtual digital asset is proposed to mean any information or code or number or token (not being Indian
currency or any foreign currency), generated through cryptographic means or otherwise
- Income from transfer of any VDA shall be taxed at the rate of 30%
- No deduction in respect of any expenditure (other than cost of acquisition)
- No set off of any loss on transfer of VDA shall be allowed against any other income
- No carried forward of such loss shall be allowed to be to subsequent assessment years
- TDS u/s 194S on payment for transfer of VDA to a resident at the rate of 1%
- Gift of virtual digital asset is also proposed to be taxed in the hands of the recipient
• New section 158AB to reduce the amount of litigation where the identical case is available or pending in appeal
before the Supreme Court or High Court against the order of the Commissioner (appeals) for other assessees
• No set-off of any loss shall be allowed against undisclosed income detected during search and survey
operations
• New section 194R to be inserted to provide that the person responsible for providing any benefit or perquisite
whether convertible into money or not shall ensure TDS to be deducted at the rate of 10% on such benefit or
perquisite
• To amend explanations under section 94, pertaining to the prevention of tax evasion through bonus stripping or
dividend stripping
• To withdraw concessional rate of taxation under Section 115BBD of 15% on
dividend income received by an Indian company from a foreign company
• New section 239A provides filing of an application for refund of wrongly deducted TDS for NRI
• Extension of the last date for commencement of manufacturing or production under section 115BAB from 31st
March, 2023 to 31st March, 2024
• Extension of the period of incorporation of the eligible start-up by one year i.e. up to 31.03.2023 for providing
such tax incentives.
• Incentivise operations from IFSC by providing additional incentives
• The conversion of interest payable into debenture or loan shall not be deemed to have been actually paid
• Increase the tax deduction limit from 10% to 14 % on employer’s NPS contribution of State
Government employees
• Deduction u/s 80DDB to include payment of the annuity or lump sum during the
lifetime of parent or guardian, once the parent or guardian has attained 60 years
• It is proposed to exempt the amount received for medical treatment and on account of death due to COVID-19
by the family members
• Other changes made in the following provisions:
- Rationalization of provisions relating to assessment and reassessment
- Clarification is brought to disallow expenses incurred during the previous year under section 14A where exempt
income is not accrued or arisen during the previous year
- Extension and amendments are made in Faceless Assessment
- Rationalisation of the provision of Charitable Trust and Institutions
- Reduction of Goodwill from block of assets to be considered as transfer
- It is proposed to amend section 194-IA to provide that in case of transfer of an immovable property TDS is to be
deducted at 1% of such sum credited to the resident or the stamp duty value of such property, whichever is
higher
- To deduct TDS by the person giving benefits to its agents if the aggregate value of such benefits exceeds
20,000 during the financial year
- Surcharge of AOP’s has been reduced from 37% to 15%
GST
• No changes on GST Rate specified
• It is proposed to amend the due date of availing ITC of previous year up to 30th November.
• ITC can be availed only if the same is reflected in GSTR-2B
• Composition Tax Payer’s Registration can be cancelled suo-moto if they have not filed their return beyond 3
months from the due date
• Credit Notes in respect of supply made in a financial year can be issued by 30th November of next financial
year
• Any rectification of error in GSTR-1/ GSTR-3B is now permitted till 30th November of next financial year
• Non-resident taxable person needs to submit returns by 13th instead of 20th of next month
• Levy of late fee for delayed filing of TCS returns
• To allow transfer of amount available in cash ledger from one branch to another branch
• Government is empowered to cap on the maximum proportion of output tax liability which may be discharged through the electronic credit ledger and impose restrictions for utilizing the amount available in the electronic credit ledger
• Retrospective effect to amend the levy of interest from 24% to 18% towards the wrong claim of input tax credit availed from 1st July 2017
• Correction in TCS return will be allowed till 30th November of next financial year
• Embassy / consulates / UIN holders can claim refund of ITC availed within 2 years from previous period of 6 months
• Application for Refund of ITC can now be made by all taxpayers instead of only
export and differential tax rate taxpayers
CUSTOMS
• Customs administration to be fully IT driven in SEZs on the Customs National Portal
• Phasing out concessional rates in capital goods and project imports gradually and apply a moderate tariff of 7.5%
• A few exemptions are being introduced on inputs, like specialized castings, ball screw and linear motion guide, to encourage domestic manufacturing of capital goods
• Customs duty rates are being calibrated to provide a graded rate structure to facilitate domestic manufacturing of wearable devices, hearable devices and electronic smart meters.
• Duty concessions are also being given to parts of transformer of mobile phone chargers and camera lens of mobile camera module and certain other items
• Rationalisation of exemptions on implements and tools for agri-sector manufactured
in India
• Extension of customs duty exemption to steel scrap
• Reduction of duty on certain inputs required for shrimp aquaculture
• Duty on cut and polished diamonds and gemstones is being reduced to 5 per cent
• Simply sawn diamond would attract nil customs duty
• Duty on imitation jewellery is being prescribed in a manner that a duty of at least 400 per Kg
• Customs duty on certain critical chemicals namely methanol, acetic acid and heavy feed stocks for petroleum refining are being reduced, while duty is being raised on sodium cyanide
• Duty on umbrellas is being raised to 20 per cent
• New exemptions are being provided on items such as embellishment, trimming, fasteners, buttons, zipper, lining material, specified leather, furniture fittings and packaging boxes
• Unblended fuel shall attract an additional differential excise duty of Rs. 2/litre from
the 1st day of October 2022
OTHER LAWS
• Introduction of Central Bank Digital Currency (CBDC) by RBI starting 2022-23.
• The Special Economic Zones Act will be replaced with a new legislation that will enable the states to become partners in ‘Development of Enterprise and Service Hubs
• Unique Land Parcel Identification Number for IT based management of land records.
• Establishing C-PACE to facilitate voluntary winding up of companies
• End to end online e-Bill System and utilising surety bonds in government procurement
• To promote clean tech and governance solutions, special mobility zones with zero fossil-fuel policy, EV vehicles and considering battery swapping policy
• Udyam, e-Shram, NCS and ASEEM portals will be interlinked
• Green Bonds to mobilise resources for green infrastructure
• Blended Finance for sunrise sectors
• Integration of central and state level systems through IT bridges
• Expanding scope of PARIVESH Portal
OTHER KEY ANNOUNCEMENTS
• PM GatiShakti is a transformative approach for economic growth and sustainable development. The approach is driven by seven engines namely, Roads, Railways, Airports, Ports, Mass Transport, Waterways, and Logistics Infrastructure.
• Issuance of chip embedded e-Passports
• Extending ECLGS with focus on hospitality and related enterprises
• 100% of post offices to come on the core banking system
• To fund infrastructure and social development based on felt needs of the North East
• 80 lakh houses to be completed in 2022-23
• National Digital Health Ecosystem will be rolled out
• Mission Shakti, Mission Vatsalya, Saksham Anganwadi, and Poshan 2.0 to be launched
• Digital Ecosystem for Skilling and Livelihood (DESH-Stack e-portal) will be launched to promote online training
• Startups will be promoted to facilitate Drone Shakti for Drone-As-A-Service
• Promoting chemical free natural farming starting with farmers’ lands close to river Ganga
• Launching fund with blended capital to finance agriculture start ups