Sitharaman assures taxpayers of continued stability by retaining prevailing rates. Start-ups receive extended tax incentives, complemented by a forward-looking Rs 26.02 lakh crore tax receipt projection, showcasing fiscal prudence.
Emphasizing the tripling of direct tax collections, the FM strategically withdraws outstanding demands, streamlines processes, and lauds GST success.
The Finance Minister highlighted that the average processing time for tax returns sees a remarkable reduction from 93 days in 2013-14 to an efficient 10 days this year.
During her budget speech, Sitharaman underscored the transformative impact of the Goods and Services Tax (GST), hailing it as the driver behind creating a unified national market with a single tax structure. She highlighted the overarching influence of tax reforms, emphasizing the expansion of the tax base under her stewardship.
Here are the salient highlights from the Finance Minister’s address, encapsulating pivotal tax reforms and measures poised to shape India’s fiscal landscape in the upcoming year:
Tax Stability Maintained:
The Interim Budget for 2024 assuages taxpayers by refraining from proposing changes in direct and indirect tax rates, inclusive of import duties, ensuring a stable taxation framework.
Continuity for Start-Ups and Investments:
A pivotal focus on fostering growth and continuity as tax benefits for Start-Ups and investments made by sovereign wealth or pension funds is extended by one year, effective until March 31, 2025. Additionally, tax exemption on specific income of IFSC units sees a parallel extension.
Projected Tax Receipts:
The budget outlines a proactive projection of Rs 26.02 lakh crore as tax receipts for the fiscal year 2024-25, indicative of the government’s meticulous fiscal planning.
Historic Growth in Direct Tax Collections:
Direct tax collections underwent an exceptional threefold surge over the last decade, a testament to the resilience and growth of the Indian economy. Concurrently, return filings witness a robust increase by 2.4 times during this period.
Withdrawal of Outstanding Direct Tax Demands:
As a proactive measure to alleviate the burden on honest taxpayers, outstanding direct tax demands up to Rs 25,000 for the period up to FY 2009-10 and up to Rs 10,000 for FY 2010-11 to 2014-15 will be withdrawn, extending benefits to approximately a crore taxpayers.
Taxpayer Services and Simplified Processes:
The Finance Minister places emphasis on the government’s unwavering commitment to enhancing taxpayer services, bringing about a transformative shift in the age-old assessment system. The average processing time for tax returns sees a remarkable reduction from 93 days in 2013-14 to an efficient 10 days this year, facilitating faster refunds.
Progressive Tax Rationalization:
Applauding the government’s strides in rationalizing tax rates, the budget ensures no tax liability for individuals with income up to Rs 7 lakh. Furthermore, the threshold for presumptive taxation for retail businesses and professionals is elevated, fostering a more business-friendly environment.
Corporate Tax Reforms:
A significant highlight is the reduction in corporate tax rates for existing domestic companies, down from 30% to 22%. New manufacturing companies enjoy an even lower rate of 15%, a move aimed at propelling industrial growth and competitiveness.
GST Success Story:
The budget commemorates the success story of the Goods and Services Tax (GST), attributing it to the reduction in the compliance burden on trade and industry. The tax base of GST has burgeoned, and the average monthly gross GST collection has nearly doubled, reaching Rs. 1.66 lakh crore.
Customs Reforms for International Trade:
In the domain of customs, the government initiates steps to streamline international trade, leading to a substantial reduction in import release times. Import release times observe a noteworthy reduction: 47% to 71 hours at Inland Container Depots, 28% to 44 hours at air cargo complexes, and 27% to 85 hours at sea ports since 2019, promoting efficiency in trade.
Finance Minister Sitharaman’s Interim Budget for 2024 signifies a balanced approach, ensuring tax stability, extending support to startups, and streamlining processes. The strategic fiscal measures present a roadmap for India’s economic trajectory, setting the stage for further growth and development.