Finance Bill 2023 was passed in the Lok Sabha without a discussion on Friday. The Bill, which gives effect to tax proposals for the fiscal year starting April 1, A total of 64 official amendments were proposed in the Bill.
Some of the amendments in the Finance Bill 2023 are:
1. Mutual Funds (MFs) having less than 35 percent AUM (Assets under management) in domestic equity are to be taxed as short-term capital gains.
2. Enhanced tax benefits to offshore banking units operating in GIFT City (Gujarat International Finance Tec-City). Offshore banking units to get 100 percent deduction on income for 10 years.
3. Tax on Royalty or technical fee earned by foreign (non-resident) Cos hiked from 10 percent to 20 percent.
4. No Change in tax on non-par savings insurance products (Rs 5 lakh cap remains).
5. No change in taxation on REITS/INVITS despite representation (‘Repayment of loans’ from REITS to the investor to be taxed as ‘income from other sources and NOT as capital gains).
6. No change in residential housing Rs 10 crore cap on capital gains re-investment.
7. All credit cards payments for foreign tours to be considered under LRS. The Reserve Bank of India (RBI) to look into the payments made through credit cards for foreign tours which escape tax at source.
8. A committee to be set up under the finance secretary on the pension system to address the needs of employees and also maintain fiscal prudence.
9. Tax Collection at Source (TCS) shall apply to all Liberalized Remittance Scheme (LRS) even if within India.
10. Tax proposed on the income from debt mutual fund at the applicable rate since it is of the nature of interest income
11. Marginal relief proposed to the tax that one pays should not be more than the income that exceeds 7 lakh (Rs 100 in this case).
12. The Securities Transaction Tax on sale of options hiked to Rs 2,100 on a turnover of Rs 1 crore, compared to the earlier Rs 1,700.