Finance Minister Nirmala Sitharaman, in her presentation of the Union Budget for the fiscal year 2024-25, introduced several pivotal changes, marking the beginning of Prime Minister Narendra Modi’s third term. This budget also marks Sitharaman’s seventh consecutive presentation, surpassing the previous record held by former Prime Minister Morarji Desai.
Key Highlights from the Budget Speech:
- Digital Services: All major taxpayer services will be digitalized to streamline processes and enhance efficiency.
- New Initiatives:
- The “Vivaad Se Vishwas Scheme 2024” has been launched to resolve tax disputes and reduce litigation.
- The monetary limits for filing tax appeals are set to increase.
- Angel tax is abolished for all classes of investors, aiming to ease investment regulations.
- Simplified Tax Regime:
- A simplified tax regime is proposed for the shipping cruise industry.
- Corporate tax for foreign firms is reduced to 35%.
- Tax Adjustments:
- The limit for Long-Term Capital Gains (LTCG) tax is increased from 10% to 12.5%.
- The TDS rate for e-commerce operators is reduced from 1% to 0.1%.
- Income Tax Act Review: Sitharaman announced a comprehensive review of the Income Tax Act of 1961, aimed at reducing disputes and litigation, with the review expected to be completed in six months.
- Customs Duty and Tax Exemptions:
- A review of the customs duty structure is planned over the next six months.
- The budget proposes merging two tax exemption regimes for charities and decriminalizing delays in TDS payments up to the filing date.
These measures are designed to simplify tax regimes, enhance digital services, and support investment and corporate growth while addressing key areas of tax compliance and dispute resolution.