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<h1>TDS reform: category-based withholding rates introduced with new TDS on mutual fund and life-insurer payouts, subject to thresholds.</h1> Proposed TDS rates under a consolidated code set category-based withholding for resident deductees: salary at average annual tax rate; most contracts and services at 2% (with road goods carriage exempt if PAN furnished); routine receipts such as interest, dividends, commissions, professional fees, royalties and compensation at 10%; machinery rent at 2% and land/building rent at 10%; gambling and race winnings at 30%. New TDS introduced on mutual fund distributions and non-tax-exempt life-insurer payments with lower rates for individuals/HUFs and a small-payment threshold exemption.