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    NewsBills
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    Tax-neutral relocation: inclusion of retail schemes and ETFs in IFSC resultant fund definition enables tax-neutral transfers for investors.
    The amendment adds retail schemes and Exchange Traded Funds (ETFs) established and regulated in the IFSC to the definition of resultant fund, so that transfers by investors of shares, units or interests in an original fund in exchange for interests in such IFSC funds are not treated as transfers for capital gains purposes, preserving the tax-neutral nature of relocations into IFSC funds.
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    Long-term capital gains exemption for sovereign wealth and pension funds extended; investment deadline moved to 2030, effective April.
    Clause (23FE) of section 10 is amended to exclude long-term capital gains arising from investments in India from the total income of specified persons, even if such gains are deemed short-term under section 50AA, and to extend the qualifying investment date from 31st March, 2025 to 31st March, 2030; the amendments take effect from 1st April, 2025.
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    Presumptive taxation for non-resident service providers to electronics manufacturing facilities creates a deemed profit basis, reducing effective tax.
    A presumptive taxation regime under proposed section 44BBD deems a fixed proportion of aggregate amounts received/receivable or paid/payable to non-residents for providing services or technology to resident companies establishing or operating electronics manufacturing or connected facilities under a Central Government notified scheme as profits and gains, simplifying tax treatment and lowering the effective tax on gross receipts, subject to prescribed conditions and rules.
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    Tonnage tax extension to inland vessels allows eligible inland ships to opt into the tonnage tax regime from AY 2026 27.
    Inland vessels registered under the Inland Vessels Act, 2021 are made eligible as qualified ships for the tonnage tax regime by aligning the income tax definition of inland vessels with that Act and by introducing corresponding amendments to extend tonnage tax benefits to inland vessels. The amendments are effective from 1 April 2026 and apply to the assessment year 2026 27 and subsequent assessment years.
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    Charitable trust tax exemption requires registration and compliance with application, approval and cancellation procedures under the law.
    Income of a trust or institution is exempt only if it meets statutory conditions and maintains registration; one provision governs the application procedure to obtain registration to claim exemption, another governs approval and cancellation of registration, and a separate provision disqualifies exemption where specified conditions are not satisfied.
    NewsBills
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    Specified violation classification: incomplete registration applications excluded from grounds for cancellation under section 12AB, limiting tax exposure.
    The Finance Bill amends the Explanation to sub section (4) of section 12AB to provide that situations in which the application for registration of a trust or institution is not complete shall not be treated as a specified violation for purposes of cancellation of registration, thereby excluding mere incompleteness of the registration application from grounds that could trigger cancellation and consequent taxability under Chapter XII EB.
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    Registration period for smaller trusts extended to reduce compliance where income and application criteria are met.
    The period of registration for trusts or institutions that apply under the specified application categories of section 12A(1)(ac) will be extended from five years to ten years where the total income, before applying sections 11 and 12, does not exceed the stated income threshold in each of the two preceding years; the change aims to reduce compliance for smaller trusts and will take effect from 1 April 2025.
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    Substantial contribution threshold revised, narrowing specified persons and excluding relatives and related concerns from applicability.
    The amendment recalibrates the substantial contribution test by raising annual and aggregate contribution thresholds so that only larger contributors qualify as specified persons, and excludes relatives and concerns in which such contributors have substantial interest from the specified persons list; the changes apply prospectively from the Finance Bill's commencement date.
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    Taxation of business trusts clarified: long-term capital gains treatment for units preserved alongside maximum marginal rate application.
    The Finance Bill amends the taxation of business trusts to clarify that a business trust's total income remains taxable at the maximum marginal rate but subject to the long-term capital gains provision applicable to units of a business trust, thereby preserving pass-through taxation of interest, dividend and rental income in the hands of unit holders and explicitly aligning capital gains treatment with the special regime for REITs and InVITs.
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    Significant economic presence exclusion clarified: purchases in India solely for export do not create business connection and are excluded.
    Amendment clarifies that transactions confined to the purchase of goods in India for export by a non resident shall not constitute Significant Economic Presence and therefore shall not constitute a Business Connection in India under section 9, aligning Explanation 2A with the exclusion in Explanation 1 and preserving the non taxable character of purchase for export operations.
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    Capital treatment of ULIP redemptions clarified: ULIPs without insurance exemption taxed as capital gains and treated as capital assets.
    The proposal treats Unit Linked Insurance Policies for which the insurance-exemption does not apply as capital assets, mandates that profits on their redemption be taxed as capital gains, and includes those ULIPs within the definition of equity oriented funds for preferential capital-gains treatment; the measure responds to an existing premium-based exemption threshold and distinguishes non-ULIP life policy proceeds taxed as income from other sources where exemption is inapplicable.
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    Capital asset classification: securities held by specified investment funds treated as capital assets, producing capital gains treatment.
    The Act is amended to treat securities held by investment funds that acquired them in accordance with securities-market regulations as capital asset, so that any income from their transfer will be treated as capital gain; the amendment applies prospectively from the specified commencement and to subsequent assessment years.
    NewsBills
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    Start-up tax deduction extended, expanding eligibility for newly incorporated start-ups to a later cutoff while retaining certification conditions.
    Amendment extends the temporal eligibility for the startup tax deduction, preserving the mechanism that permits an eligible start up to claim a full deduction of profits for a limited number of assessment years from the year of incorporation, conditional on meeting the turnover ceiling, holding an eligibility certificate from the inter ministerial board, and making the elective claim; the amendment moves the incorporation cutoff forward and takes effect from 1 April 2025.
    NewsBills
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    Taxation of long-term capital gains increased for non-resident securities transfers to align rates with the resident regime.
    The Finance Bill proposes amending section 115AD so that income-tax on long-term capital gains arising from transfer of securities (other than units under section 115AB) not covered by section 112A, when included in the total income of specified funds or foreign institutional investors, shall be calculated at the harmonised higher rate applicable to other assessees, with effect from the specified assessment year.
    NewsBills
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    Rationalization of TDS rates aims to simplify withholding rules and raise applicability thresholds to improve compliance and business ease.
    Rationalization of Tax Deduction at Source (TDS) rates is proposed in the Union Budget 2025 26 and Finance Bill, 2025, to simplify multiple TDS rates and raise threshold limits for applicability, with the aim of reducing fragmentation, lowering compliance burdens, and promoting ease of doing business.
    NewsBills
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    TDS rate reduction for securitisation trust payments under section 194LBC lowers withholding and eases compliance.
    The Finance Bill reduces TDS under section 194LBC on income paid by securitisation trusts to resident investors from the earlier rates of 25% (individuals/HUF) and 30% (others) to a uniform 10%, on the basis that the sector is sufficiently organised and regulated; the amendment takes effect from 1 April 2025 as Clause 63 of the Bill.
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    TDS threshold rationalization raises and standardizes withholding triggers, reducing routine tax deductions on smaller payments.
    The proposal titled TDS threshold rationalization raises and standardizes the monetary thresholds that trigger tax deduction at source for multiple categories-interest (including securities), dividends to individuals, mutual fund/unit incomes, various winnings, insurance commission, lottery-related income, brokerage and commission, professional and technical fees, rent, and enhanced compensation-altering per-transaction and annual benchmarks and distinguishing treatment by payer type and payment mode for withholding obligations.
    NewsBills
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    TDS on interest on securities: threshold increased to reduce small-value deductions and limit routine withholding.
    Section 193 requires deduction of tax on interest on securities at time of credit or payment to a resident. The Finance Bill, 2025 proposes that tax shall be deducted under this section only when the amount or aggregate amount of interest on securities exceeds a specified monetary threshold during a financial year, and consequentially amends the proviso relating to debenture interest; the amendment takes effect from 1 April 2025.
    NewsBills
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    Dividend tax withholding: higher exemption threshold for individual shareholders reduces small-payment TDS obligations from next fiscal year.
    Section 194 requires the principal officer of an Indian company, or a company with prescribed arrangements for dividend payments (including preference shares), to deduct tax at source from dividend payments to resident shareholders at the rate provided in the section. The Finance Bill raises the aggregate exemption threshold for individual shareholders under the first proviso so that no tax is required to be deducted on small aggregate dividend payments, with the amendment effective from the start of the next fiscal year.
    NewsBills
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    TDS on interest thresholds increased, raising exemption limits for banks, cooperatives and post office deposits next fiscal year.
    Amendments raise thresholds under Section 194A for deduction of tax at source on interest other than interest on securities, increasing payer-specific limits for banks, cooperative banks, certain cooperative societies and notified post office deposits from forty thousand to fifty thousand and raising the baseline for other payers from five thousand to ten thousand; senior citizen thresholds for the specified payer categories are increased to one hundred thousand and to ten thousand for other payers. The revised thresholds take effect from the first day of the fiscal year beginning April 1, 2025.

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      Review of concessional rates of BCD prescribed in notification no. 50/2017 - Customs dated 30.62017: The BCD exemption hitherto available on certain goods are being withdrawn by omitting following entries of notification No. 50/2017-Customs dated 30.6.2017.

      3 February, 2020

      Contents
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      Budget 2020-21 + FINANCE BILL, 2020

      S. No.

      S. No. of Notification No 50/2017-customs

      Description

      1.

      5

      Tuna bait [0303]

      2.

      7

      Goods upto an aggregate of ten thousand metric tonnes of total imports of Milk and cream, in powder, granules or other solid form in a financial year. [0402 10, 0402 21 00]

      3.

      7A

      Whey, concentrated, evaporated or condensed, liquid or semi-solid [0404 10 10]

      4.

      7B

      Other Whey [0404 90 00)

      5.

      8

      Butter Ghee, Butter Oil [0405]

      6.

      9

      Other cheese [0406 90 00)

      7.

      10

      Pancreas (Products of animal origin, not elsewhere specified) (Chapter 5]

      8.

      11

      Conch shell [0508 00]

      9.

      18

      Bulbs or tubers, other live plants [0601 or 0602]

      10.

      36

      All goods other than meslin or wheat [1001]

      11.

      38

      Meslin [1001]

      12.

      40

      Maize upto an aggregate of five lakh metric tonnes of total imports of such goods in a financial year [1005 90]

      13.

      47

      Sugar beet seeds [1209 10 00)

      14.

      56

      Edible oils [1508, 1512, 1513, 1514, 1515 or 1511 10]

      15.

      58

      Refined vegetable oils of edible grade, in loose or bulk form (other than palm oil) [chapter 15]

      16.

      59

      Vegetable oils of edible grade, in loose or bulk form (other than those specified against S. No. 58 and palm oil), imported for the manufacture of oil commonly known as “Vanaspati” or for refining.

      Explanation. -The expression “Vegetable oil” means-

      (a) in the case of cottonseed oil, oil having a free fatty acid content of at least 0.2%; and

      (b) in the case of any other vegetable oil. oil with free fatty acid content of at least 0.5%. [15]

      17.

      68

      Crude sunflower seed or safflower oil upto an aggregate of one lakh and fifty thousand metric tonnes of total imports of such goods in a financial year [1512 11]

      18.

      69

      Crude sunflower seed or safflower oil other than those specified against S. No. 68 [1512 11]

      19.

      72

      Refined rape, colza or mustard oil upto an aggregate of one lakh and fifty thousand metric tonnes of total imports of such goods in a financial year (1514 19 or 1514 99]

      20.

      78

      Margarine, animal or vegetable oils of edible grade [1517 or 1518]

      21.

      83

      Glycerol, crude; glycerol waters and glycerol lyes, (other than crude glycerin) [1520 00 00]

      22.

      88A

      Raw Sugar upto an aggregate of three lakh metric tonnes of total imports of such goods. Provided that the import of raw sugar in physical form is completed within sixty (60) days from the date of issue Of the Tariff Rate Quota Allocation Certificate or license by Directorate General of Foreign Trade (DGFT) to the importer. Provided further that the importer shall convert the raw sugar into white/ refined sugar within a period, not exceeding thirty (30) days, from the date of filing of bill of entry or the date of entry inwards, whichever is later [1701]

      23.

      89

      Dextrose Monohydrate [1702)

      24.

      92

      Molasses resulting from extraction or refining of sugar [1703]

      25.

      93

      Chewing gum whether or not sugar coated [1704 10 00]

      26.

      94

      Food preparations, for infant use and put up for retail sale, of-

      (i) goods of headings 0401 to 0404, containing cocoa calculated on a totally defatted basis, in a proportion by weight of 5% or more but less than 10%; or

      (ii) flour, meal, starch or malt extract containing cocoa calculated on a totally defatted basis, in a proportion by weight of 40% or more but less than 50% [1806 90)

      27.

      95

      Preparations for infant use put up for retail sale [1901 10]

      28.

      98

      preserved potatoes [2004 10 00]

      29.

      99

      Peanut Butter [2008 11 00]

      30.

      105

      Wine, for use as sacramental wine [22]

      31.

      108

      Angostura bitters [2208]

      32.

      113

      Fin fish feed [2301 20, 2309 90 32, 2309 90 39]

      33.

      115

      Dietary soya fibre [2304]

      34.

      148

      Naphtha, when imported by Ratnagiri Gas and Power Private Limited (RGPPL), for use in generation of electricity in the power plants of Ratnagiri Gas and Power Private Limited (RGPPL) at Dabhol, District Ratnagiri, Maharashtra [2710]

      35.

      149

      Naphtha, when imported for generation of electrical energy by a generating company as defined in section 2(28) of the Electricity Act, 2003 (36 of 2003) to supply electrical energy-or to engage in the business of supplying electrical energy [2701]

      36.

      152

      Propane, Butane [2711 12 00, 2711 13 00]

      37.

      160

      Electrical energy [ 2716 00 00]

      38.

      170

      Phosphoric acid, for the manufacture of fertilizers(28]

      39.

      212

      Japanese Encephalitis (JE) vaccine, imported by the Andhra Pradesh Government through UNICEF [30]

      40.

      220

      Kyanite salts, in a form indicative of their use for manurial purpose [31]

      41.

      243

      Isolated soya protein [3504]

      42.

      244

      Colour positive unexposed cinematographic film in jumbo rolls and colour negative unexposed cinematographic film in rolls of 400 feet and 1000 feet [37]

      43.

      245

      Instant print film [3701 20 00 or 3702]

      44.

      246

      Cinematographic films, exposed but not developed [3704]

      45.

      247

      Promotional material (like Trailers, making of film etc.) imported in the form of electronic promotion kits (EPK)/ beta cams (Any Chapter)

      46.

      263

      The following polymers of ethylene, namely: -

      (i) Cow density polyethylene (LDPE),

      (ii) Linear low-density polyethylene (LLDPE),

      (iii) High density polyethylene (HDPE),

      (iv) Linear medium density polyethylene (LMDPE),

      (v) Linear high-density polyethylene (LHDPE) [3901]

      47.

      264

      All goods other than poly 'so-butylene [39021

      48.

      266

      All goods [3903]

      49.

      274

      Compostable polymer or bio-plastic used in the manufacture of bio degradable agro mulching films, nursery plantation pots and flower pots [3913 90 90]

      50.

      275

      Water blocking tape for use in the manufacture of insulated Wires and cables falling under heading 8544 (except sub-heading 8544 11) [3919 90 90]

      51.

      278

      Subbed polyester base, imported by M/s. Hindustan Photo Films Manufacturing Company Limited, Udhagamandalam for the manufacture of medical or industrial X-ray films and graphic art films [39201

      52.

      286

      Patent leather [4114 20 10]

      53.

      287

      Raw furskins [4301). tanned and dried furskins [4302]

      54.

      386

      Lead bars. rods. profiles and wire [7806]

      55.

      388

      Zinc tubes, pipes and tube or pipe fittings [7907]

      56.

      389

      Tin plates, sheets and strip, of a thickness exceeding 0.2 mm; tin foil (whether or not printed or backed with paper, paperboard, plastics or similar backing materials), of a thickness (excluding any backing) not exceeding 0.2 mm; tin powders and flakes [8007]

      57.

      398

      Parts and components of the goods specified in List 10 required for use in high voltage power transmission project (Any chapter]

      58.

      401

      All items of equipment including machinery and rolling stock, procured by or on behalf of Delhi Metro Rail Corporation Ltd. for use in-

      (i) Delhi MRTS Project Phase-I, and

      (ii) Specified corridors of Delhi MRTS Project Phase-Il, comprising of the following, namely: -

      (a) Vishwavidyalaya- Jahangirpuri;

      (b) Central Secretariat-Qutab Minar (via All India Institute of Medical Sciences);

      (c) Shahdara- Dilshad Garden;

      (d) Indraprastha-New Ashok Nagar;

      (e) Yamuna Bank-Anand Vihar-lnter State Bus Terminus; and

      (f) Kirti Nagar-Mundka (along with operational Link to Shahdara- Rithala corridor) (Any Chapter)

      59.

      412

      Goods specified in List 15 required for construction of roads [84 or any other chapter]

      60.

      447

      The following goods required for manufacture of Optical disk drives (ODD), namely: -

      (i) Pick up assembly

      (ii) Digital signature procession integrated circuit

      (iii) DC motor

      (iv) LDO voltage regulator [84 or Any other Chapter]

      61.

      456

      The following goods, namely: -

      (a) Sprinklers and drip irrigation systems for agricultural and horticultural purposes;

      (b) Micro Irrigation equipment [8424]

      62.

      457

      Poultry incubators and brooders [8436 21 00]

      63.

      459

      Parts for manufacture of printers falling under sub heading 8443 32 (except 8443 99 51, 8443 99 52, 8443 99 53) [8443]

      64.

      465

      CD -Writers (8471]

      65.

      474

      MP3 or MP4 or MPEG 4 player with or without radio or video reception facility [85]

      66.

      483

      One set of pre-recorded cassettes accompanying books for learning languages and essential complement to such books, [85]

      67.

      484

      Audio cassettes, if recorded with material from books, newspaper or magazines, for the blind [85]

      68.

      515

      Colour television picture tubes for use in the manufacture of cathode ray televisions [8540 11]

       

       


      Full Text:

      Budget 2020-21 + FINANCE BILL, 2020

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