Measures
to promote growth and employment generation: Tax policy plays an important role
in promoting the growth and creation of employment. A number of measures have
been taken by this Government in this direction, some of which are as under:
(i)
Profit-linked deduction was introduced for start-ups.
(ii)
The scope of investment-linked deduction was broadened by including certain new
sectors, including infrastructure, which are critical to growth.
(iii)
Investment allowance and higher additional depreciation was provided for
undertakings set up in backward regions of states of Andhra Pradesh, Bihar,
Telangana and West Bengal.
(iv)
Incentive for employment generation was broadened and the conditions for
eligibility to claim the incentive were relaxed.
(v) Benefit was provided for computation of
MAT liability and carry forward of loss for companies under Insolvency and
Bankruptcy Code (IBC).
(vi)
Safe Harbour provisions were further liberalised to align with industry
standards.
(vii)
Scope of domestic transfer pricing provisions was restricted only for
transactions between enterprises having profit-linked deductions.
(vii)
Pass through status was provided to Category I & II Alternative Investment
Funds (AIFs).
(viii) The time period for carry forward of
MAT credit was increased from 10 to 15 years.
.
.
Enumerate
measures taken by government to enhance
the sources of capital for infrastructure financing in India?
Ease
of compliance for small businesses: Small businesses constitute the backbone of
our economy. In order to reduce the compliance burden of small businesses and
professionals, following measures have been taken by this Government: (i)
Threshold for presumptive taxation of businesses was raised from Rs. 1 crore to
Rs. 2 crore. (ii) For maintenance of books of accounts by individuals and HUFs,
(a) income threshold was raised from Rs. 1.20 lakh to Rs. 2.5 lakh; and (b)
turnover threshold was raised from Rs. 10 Lakh to Rs. 25 Lakh. (iii)
Presumptive taxation was introduced for professionals having receipts up to Rs.
50 lakh. 5. Measures to incentivise affordable housing and real estate:
Measures
to incentivise affordable housing and real estateHousing has been an area of
concern for middle and lower-middle class. Further, real estate sector plays a
significant role in generating employment in the economy. Considering the
importance of housing sector, this Government has taken the following measures
to promote this sector: (i) Deduction of interest on loan taken to purchase
selfoccupied house property was increased from Rs. 1.5 lakh to Rs. 2 lakh. (ii)
100% deduction was provided for the income of affordable housing projects.
(iii) The base year for computation of long term capital gains was shifted from
1981 to 2001. (iv) Holding period for long-term gain on immovable property was
reduced from 36 months to 24 months. (v) Safe harbour of 5% on stamp duty value
was provided for the purpose of computation of capital gains on immovable
property.
.
.
Incentives
for start-ups: The condition for carry forward and set off of losses in cases
of eligible start-ups is proposed to be relaxed enabling them to carry forward
their losses on satisfaction of any one of the two conditions, i.e. continuity
of 51% shareholding/voting power or continuity of 100% of original
shareholders. Further, the provision which allows exemption of capital gains
from sale of residential property on investment of net consideration in equity
shares of eligible start-up shall be extended by 2 years. Thus the benefit
shall be available for sale of residential property on or before 31st March,
2021. The condition of minimum holding of 50% of share capital or voting rights
in the start-up is proposed to be relaxed to 25%. The condition restricting
transfer of new asset being computer or computer software is also proposed to
be relaxed from the current 5 years to 3 years.
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