The Union Finance Minister Shri Arun Jaitley in his Budget Speech in Lok Sabha today announced measures to improve the ease of doing business so as to achieve ‘Minimum Government and Maximum Governance’. He sought to bring about simplification of tax procedures in the Financial Bill 2015. Monetary limits for a case to be heard by a single member bench of ITAT is proposed to be increased from ₹ 5 lakh to ₹ 15 lakh. The proposed amendments in the Income-tax Act provide that:

• Penalty provision in indirect taxes are being rationalized to encourage compliance and early dispute resolution.
• Central excise/ Service tax assesses to be allowed to use digitally signed invoices and maintain record electronically.
• Wealth-tax replaced with additional surcharge of 2 per cent on super rich with a taxable income of over ₹ 1 crore annually.
• Provision of indirect transfers in the Income-tax Act suitably cleaned up.
• Applicability of indirect transfer provisions to dividends paid by foreign companies to their shareholders to be addressed through a clarificatory circular.
• Domestic transfer pricing threshold limit increased from ₹ 5 crore to ₹ 20 crore.
• MAT rationalized for FIIs and members of an AOP.
• Tax Administration Reform Commission (TARC) recommendations to be appropriately implemented during the course of the year.
• Education cess and the Secondary and Higher education cess to be subsumed in Central Excise Duty.
• Specific rates of central excise duty in case of certain other commodities revised.
• Excise levy on cigarettes and the compounded levy scheme applicable to pan masala, gutkha and other tobacco products also changed.
• Excise duty on footwear with leather uppers and having retail price of more than ₹ 1000 per pair reduced to 6 %.
• Online central excise and service tax registration to be done in two working days.
• Time limit for taking CENVAT credit on inputs and input services increased from 6 months to 1 year.
• Service-tax plus education cesses increased from 12.36% to 14% to facilitate transition to GST.
• Donation made to National Fund for Control to Drug Abuse (NFCDA) to be eligible for 100% deduction u/s 80G of Income-tax Act.
• Seized cash can be adjusted towards assesses tax liability.

Simplification of tax procedures: higher tribunal thresholds and rationalized indirect tax penalties to ease compliance and disputes. Proposed simplification of tax procedures includes raising monetary thresholds for single member tribunal hearings, rationalizing indirect tax penalties to promote compliance, allowing digitally signed invoices and electronic records for excise and service tax assesses, extending the time limit for CENVAT credit, revising excise and service tax rates and registrations, and implementing Tax Administration Reform Commission recommendations. Substantive changes replace the wealth tax with an additional surcharge on very high incomes, clarify indirect transfer provisions including dividend treatment by foreign companies, increase the transfer pricing applicability threshold, rationalize MAT for certain investors, permit full 80G deductions for specified donations, and allow seized cash to be adjusted against tax liability.