Interim Budget 2014 : No Changes Proposed in Direct Taxation-Income Tax , Service Tax
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Finance Minister P Chidambaram today ahead of General Elections due in next three months presented Interim Budget 2014-15.
An Interim Budget or vote on account is only about the outgoing government's income and expenses made during the last year and to seek the Parliament's approval for the expenses proposed to be made in the next few months.
As expected the Finance Minister did not propose any changes in the existing direct tax structure and the existing rates shall continue for FY 2014-15.
STATEMENT OF OBJECTS AND REASONS of The Finance Bill 2014 (Bill No. 7 of 2014) states as under:
The object of this Bill is to continue the existing rates of income-tax for the financial year 2014-15.
2. Clause 2 of the Bill deals with the rates of income-tax and surcharge. The rates of income-tax and surcharge as specified in Part III of the First Schedule to the Finance Act, 2013 for the purpose of deduction of tax at source from salaries during the financial year 2013-14, for computing the "advance tax" payable during that financial year in relation to current incomes and for certain special purposes, are proposed to be continued for the purpose of assessments for the assessment year 2014-15. Further, the same rates are proposed to be continued for the purpose of deduction of tax at source from salaries during the financial year 2014-15, for computing the "advance tax" payable during that financial year on current incomes, and for the said special purposes.
3. The rates for deduction of tax at source during the financial year 2013-14 from incomes other than salaries specified in Part II of the First Schedule to the Finance Act, 2013, are also proposed to be continued for deduction of tax at source from such incomes during the financial year 2014-15.
4. Clause 2 of the Bill, accordingly, proposes to apply to the assessment year 2014-15 or, as the case may be, to the financial year 2014-15, the provisions of section 2 of, and the First Schedule to, the Finance Act, 2013, with consequential and other necessary modifications.
Accordingly, there are no changes proposed including any of the following:
No Changes in Income Tax Slabs or Rates for Individuals/Companies, Firms etc.
No Changes in Rates of Surcharge.
No Changes in Tax Deducted at Source related provisions.
No Changes in Deductions under Chapter VIA.
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Goods & Service Tax (GST) and Direct Tax Code (DTC)
In his Budget Speech, Finance minister expressed disappointment in delays in introducing GST. He also referred to Direct Tax Code stating that it would serve the country for at least twenty years. He indicated that both shall be placed on the website for a public discussion and appeal to all political parties to resolve to pass the GST laws and the DTC in 2014-15.
Research Funding Organization
The finance minister has proposed to set up a Research Funding Organisation that will fund research projects selected through a competitive process. Contributions to that organisation will be eligible for tax benefits. He mentioned that this will require legislative changes which can be introduced at the time of the regular Budget.
Illegal Black Money in Foreign Accounts
The Finance Minister told the Parliament that Investigations into on illegal off-shore accounts held by Indians were launched in 2011 and the Government has succeeded in obtaining information in 67 cases and action is underway to determine the tax liability as well as impose penalty. Prosecutions for wilful tax evasion have been launched in 17 other cases. He informed that more enquiries have been initiated into accounts reportedly held by Indian entities in no tax or low tax jurisdictions.
17-02-2013 * GST and DTC to be put for Public Discussion *