Exchange of information expanded to include banking and ownership data, with new limits on treaty benefits and shipping taxation.
The Protocol amends the DTAA to expand the Exchange of Information to permit foreseeable information exchange-including banking and ownership data-and to allow use for tax purposes (and other authorised uses); it applies prospectively. It introduces residence-based taxation for international shipping income, removes specified tax-sparing relief on interest, limits tax-rate divergence between residents and non-resident permanent establishments, includes recognised pension funds as residents, and adds a Limitation of Benefit clause to prevent treaty misuse on dividends, interest, royalties and similar income.

Direct Taxes Code Bill consolidates income and wealth taxation, setting residence, computation, incentives, anti avoidance and procedural regimes.
The Direct Taxes Code, 2010 consolidates and replaces the Income-tax Act and Wealth Tax Act into a single statute of 319 sections and 22 schedules, setting out the basis of charge, residence and deemed accrual/receipt rules, classification and computation of income under specified heads, aggregation and loss continuity rules, industry and transaction specific schedules, a wide range of tax incentives and deductions, detailed tax administration, assessment, appeals, recovery, penalties and prosecutorial provisions, anti avoidance measures, advance rulings and dispute resolution, and confers rule making and notification powers on the Central Government and the Board.

Tax exemption limit increase under Direct Taxes Code Bill, with proposed removal of corporate surcharge and cesses.
The Direct Taxes Code Bill proposes raising the individual income tax exemption threshold and abolishing surcharge and cesses on corporate income tax; the Cabinet has approved the Bill for tabling in Parliament and anticipated referral to a joint select committee for detailed consideration.

SEZ tax exemptions enable export income relief and duty free procurement, with service tax refund mechanisms for SEZ use.
SEZs receive duty free import and domestic procurement for development and operations; phased income tax exemptions on export income under Section 10AA, exemption from minimum alternate tax, and permitted external commercial borrowings. Developers obtain customs/excise exemptions for authorized development, a time bound income tax exemption under Section 80 IAB, exemption from minimum alternate tax, and exemption from dividend distribution tax. Service tax treatment distinguishes services rendered wholly within SEZs (exempt), services provided outside but used by SEZs (refundable), supplies to domestic tariff area units (taxable), and exported services (not chargeable).

Exchange of banking information expanded in renegotiated tax treaties; enforcement action for unauthorized foreign accounts.
Immediate enforcement under the Foreign Exchange Management Act addresses unauthorized foreign bank accounts and retention of funds abroad; the Government is renegotiating existing Double Taxation Avoidance Agreements to strengthen Exchange of Information provisions to permit banking information exchange. The India-Mauritius convention is being reviewed to prevent treaty shopping via safeguards developed by a Joint Working Group, and India seeks Tax Information Exchange Agreements with jurisdictions like the Cayman Islands instead of DTAAs to align with international standards.

Tax service centres expansion: additional Aayakar Seva Kendras planned, funded from existing departmental budgets to improve taxpayer services
The Government will expand Aayakar Seva Kendras by establishing additional tax service centres in selected cities as part of a phased rollout supplementing a three-location pilot; implementation targets state capitals and mid-size cities. No separate central funds are being released for these centres; the concerned Chief Commissioners of Income Tax will incur establishment expenditure from existing departmental budget grants.

Point of taxation rules link service tax liability to the earliest of service provision, invoice issuance, or payment receipt.
The Rules fix the point of taxation for services as the earliest of provision of service, issuance of invoice, or receipt of payment; make advances taxable when received (excluding interest-free refundable deposits); prescribe that where tax rates change between provision, invoice and payment the earlier qualifying event generally determines the applicable rate; treat continuous supplies as discrete periodic supplies taxed on contractual due dates, milestone completion, or invoice/payment (read sequentially); and specify points of taxation for associated enterprises and royalties when subsequent payments or invoices occur.

Goods and Services Tax phased reform: aligned exemptions, uniform small dealer threshold and transitional dual rates to enable convergence.
The Government addresses inflation through supply side agricultural measures, enhanced procurement and MSPs, investment in storage and cold chains, expanded PDS allocations where state coverage is low, and schemes to incentivize private construction of godowns with extended guarantees. Complementary monetary tightening and expectations of moderating global commodity prices are expected to ease energy pressures. On GST, the Centre proposes a phased implementation aligning central exemptions with states, uniform small dealer exemption thresholds, optional compounding limits subject to state agreement, and a transitional dual rate CGST/SGST framework intended to converge to a common rate over time.

Centralised Processing Centre processing tax returns and issuing refunds while identifying reporting errors and TDS mismatches.
The Centralised Processing Centre at Bangalore is processing income tax returns and issuing refunds under the Income Tax Act; processing outcomes include refunds and, in some cases, post processing demands arising from incorrect reporting, unsupported claims, or mismatches in tax payments or TDS, and first year operational costs comprised office expenses, rent and departmental employee salaries.

Deduction for long-term infrastructure bonds allows additional tax relief for eligible subscribers beyond existing savings limits.
A new statutory deduction permits individuals and Hindu Undivided Families to claim up to Rs. 20,000 for subscriptions to long-term infrastructure bonds made in the specified financial year; the deduction is over and above existing overall savings limits and the class of eligible bonds, tenure, interest and issuing agencies are prescribed by government notification.

Weighted deduction for scientific research expanded to increase incentives for qualifying business payments used for approved R&D.
The weighted deduction for sums paid from business income to universities, national laboratories and Indian Institutes of Technology for approved scientific research programmes has been increased by legislative amendment, and applies only where recipients use the funds for scientific research and development; hospitals are excluded from the weighted deduction scheme while charitable donations to hospitals may qualify for a partial deduction under the charitable-deduction regime, and orphanages are not eligible.

Extended filing deadline for tax returns after technical snags and inclement weather; returns filed by new deadline deemed timely.
The Central Board of Direct Taxes announced an administrative deadline extension for filing income tax returns: all paper or electronic returns submitted on or before the extended date will be treated as filed within the due date, in response to operational interruptions in the e-filing system and adverse weather conditions that impeded timely filing.