BUDGET 2013 - EVADE TAXES, NOW BE READY TO GO TO JAIL

IMPORTANT PROPOSED CHANGES OF BUDGET 2013 - 

Now Failure to pay excise duty and service tax could lead to arrest of defaulters. 
Offences relating to excise and customs duty evasion of over Rs 50 lakh would be non‐bailable.
Similarly, failure to deposit service tax exceeding Rs 50 lakh would result in imprisonment up to seven years.

Major amendments for INDIRECT TAXES from BUDGET 2013

Major amendments for Indirect Tax from BUDGET 2013

Proposals under Indirect Tax - 

SERVICE TAX : - 

1.  No change in the normal rates of 12 percent for excise duty and service tax.

2.  Vocational courses offered by institutes affiliated to the State Council of Vocational Training and testing activities in relation to agricultural produce also included in the negative list for service tax.

3.  Exemption of Service Tax on copyright on cinematography limited to films exhibited in cinema halls.

4. Proposals to levy Service Tax on all air conditioned restaurant.

5.  For homes and flats with a carpet area of 2,000 sq.ft. or more or of a value of Rs. 1 crore or more, which are high-end constructions, where the component of services is

greater, rate of abatement reduced from from 75 to 70 percent.

6. A onetime scheme called ‘Voluntary Compliance Encouragement Scheme’ proposed to be introduced. Defaulter may avail of the scheme on condition that he files truthful declaration of Service Tax dues since 1st October 2007.

EXCISE DUTY : - 

1.  Relief to readymade garment industry. In case of cotton, zero excise duty at fibre stage also. In case of spun yarn made of man made fibre, duty of 12 percent at the fibre stage.

2.  Handmade carpets and textile floor coverings of coir and jute totally exempted

from excise duty.

3.  To provide relief to ship building industry, ships and vessels exempted from excise duty. No CVD on imported ships and vessels.

4.  Specific excise duty on cigarettes increased by about 18 %. Similar increase on cigars, cheroots and cigarillos.

5.  Excise duty on SUVs increased from 27 to 30 %. Not applicable for SUVs registered as taxies.

6.   Excise duty on marble increased from Rs. 30 per square meter to Rs. 60 per square meter.

7.   Proposals to levy 4 % excise duty on silver manufactured from smelting zinc or lead.

8.  Duty on mobile phones priced at more than Rs. 2000 raised to 6 %

9.   MRP based assessment in respect of branded medicaments of Ayurveda, Unani, Siddha, Homeopathy and bio-chemic systems of medicine to reduce valuation disputes.

CUSTOM DUTY : -

1.  No change in the peak rate of basic customs duty of 10 perent for non-agricultural products.

2. Period of concession available for specified part of electric and hybrid vehicles extended upto 31 March 2015.

3. Duty on specified machinery for manufacture of leather and leather goods including footwear reduced from 7.5 to 5 %

4.  Duty on pre-forms precious and semi-precious stones reduced from 10 to 2 perent.

5.  Export duty on de-oiled rice bran oil cake withdrawn.

6.  Duty of 10 percent on export of unprocessed ilmenite and 5 percent on export on ungraded ilmenite.

7.  Concessions to air craft maintenaince, repair and overhaul (MRO) industry.

8.  Duty on Set Top Boxes increased from 5 to10 percent.

9.  Duty on raw silk increased from 5 to 15 percent.

10.  Duties on Steam Coal and Bituminous Coal equalised and 2 percent custom duty and 2 % CVD levied on both kinds coal.

11.  Duty on imported luxury goods such as high end motor vehicles, motor cycles, yachts and similar vessels increased.

12.  Duty free gold limit increased to Rs. 50,000 in case of male passenger and Rs.1,00,000

in case of a female passenger subject to conditions.

Major amendments for Income Tax from BUDGET 2013

Main Features of budget 2013 - 

Proposals under Income tax 


1. Relief for Tax Payers in the first bracket of Rs. 2 lakhs to Rs. 5 lakhs. A tax credit of Rs. 2000 to every person with total income upto Rs. 5 lakhs.
2. Surcharge of 10 percent on persons (other than companies) whose taxable income exceed Rs. 1 crore
3. Increase surcharge from 5 to 10 percent on domestic companies whose taxable income exceed Rs. 10 crore.
4. In case of foreign companies who pay a higher rate of corporate tax, surcharge to increase from 2 to 5 percent, if the taxabale income exceeds Rs. 10 crore.
5. In all other cases such as dividend distribution tax or tax on distributed income, current surcharge increased from 5 to 10 percent.
6. Additional surcharges to be in force for only one year.
7.  Education cess to continue at 3 percent.
8. Permissible premium rate increased from 10 percent to 15 percent of the sum assured by relaxing eligibility conditions of life insurance policies for persons suffering from disability and certain ailments.
9. Contributions made to schemes of Central and State Governments similar to Central Government Health Scheme, eligible for section 80D of the Income tax Act.
10.  Donations made to National Children Fund eligible for 100 percent deduction.
12. Investment allowance at the rate of 15 percent to manufacturing companies that invest more than Rs.  100 crore in plant and machinery during the period 1.4.2013 to 31.3.2015.
13. ‘Eligible date’ for projects in the power sector to avail benefit under Section 80- IA extended from 31.3.2013 to 31.3.2014.
14. Concessional rate of tax of 15 percent on dividend received by an Indian company from its foreign subsidiary proposed to continue for one more year.
15. Securitisation Trust to be exempted from Income Tax. Tax to be levied at specified rates only at the time of distribution of income for companies, individual or HUF etc. No further tax on income received by investors from the Trust.
16.  Investor Protection Fund of depositories exempt from Income-tax in some cases.
17. Parity in taxation between IDF-Mutual Fund and IDF-NBFC.
18. A Category I AIF set up as Venture capital fund allowed pass through status under Income-tax Act.
19. TDS at the rate of 1 percent on the value of the transfer of immovable properties where consideration exceeds Rs. 50 lakhs. Agricultural land to be exempted.
20. A final withholding tax at the rate of 20 percent on profits distributed by unlisted companies to shareholders through buyback of shares.
21. Proposal to increase the rate of tax on payments by way of royalty and fees fortechnical services to non-residents from 10 percent to 25 percent.
22. Reductions made in rates of Securities Transaction Tax in respect of certain transaction.
23. Proposal to introduce Commodity Transaction Tax (CTT) in a limited way. Agricultural commodities will be exempted.
24. Modified provisions of GAAR will come into effect from 1.4.2016.
25. Rules on Safe Harbour will be issued after examing the reports of the Rangachary Committee appointed to look into tax matters relating to Development Centres & IT Sector and Safe Harbour rules for a number of sectors.
26. Fifth large tax payer unit to open at Kolkata shortly.
27. A number of administrative measures such as extension of refund banker system to refund more than Rs. 50,000, technology based processing, extension of e-payment through more banks and expansion in the scope of annual information returns by Income-tax Department.

Going to invest before 31st March - RAJIV GANDHI EQUITY SAVINGS SCHEME is good option

MAIN PROVISIONS OF RAJIV GANDHI EQUITY SAVINGS
SCHEME
 Finance Minister Mr. P Chidambaram has launched an
equity scheme called Rajiv Gandhi Equity Savings Scheme, or RGESS,
is an attempt to lure new investors to the stock market.
The main provisions of this scheme are as under:
1. The gross total income should be less than or equal to Rs. 10 lakhs.
2. Person has never invested in equities before through a Demat
account or in derivatives, then only he is eligible to invest in RGESS. It
means tax benefits are available to first-time investors in stock
market.
3. Any individual can invest up to Rs. 50000 in RGESS and can claim
the Deduction U/S 80CCG of 50% of investment amount.
4. There would be a lock-in period of three years, but Govt. has
allowed some flexibility to exit after a year of investment.
5. To be able to invest in RGESS, one need to open a Demat Account
and submit Form A, which is a declaration that an individual has never
invested in equities.
6. Individual can either buy shares of companies that are part of the
BSE 100 or National Stock Exchange (NSE) CNX 100 through a stock
broker or on your own. Or you can buy RGESS MF schemes.
7. Individual can buy Exchange Traded Funds or ETFs that are available
on the BSE or the NSE that track either the Sensex or Nifty indices.

If one has any problem regarding above or want any consultancy on above issue please feel free to contact me between 4.00PM to 6.00PM on working days

Income Tax Calculator

Calculate your Income Tax online for any Assessment Year up to A.Y. 2013-14 through following link -

http://law.incometaxindia.gov.in/DIT/Xtras/taxcalc.aspx

or

http://finotax.com/itax/itaxcalc1.htm

Get IFSC Code, MICR Code, BSR Code and Location of all bank in INDIA through using any of following links -

http://banksifsccode.com/

http://www.ifsccodeonline.com/

Rajiv Gandhi Equity Savings Scheme

Rajiv Gandhi Equity Savings Scheme (RGESS)

Rajiv Gandhi Equity Savings Scheme (RGESS) was announced by the then Finance Minister Pranab Mukherjee in his 2012-13 budget speech. The scheme is exclusively for the first time retail investors in securities market. This Scheme would give tax benefits to new investors who invest up to Rs. 50,000 and whose annual income is below Rs. 10 lakh.

The key features of the scheme are as under:

• Scheme is open to new retail investors, identified on the basis of their PAN numbers. This includes those who have opened the Demat account but have not made any transaction in equity and /or in derivatives till the date of notification of this Scheme and all those account holders other than the first account holder who wish to open a fresh account.
• Those investors whose annual taxable income is upto Rs. 10 lacs are eligible under the Scheme.
• The maximum Investment permissible under the Scheme is Rs. 50,000 and the investor would get a 50% deduction of the amount invested from the taxable income for that year.
• Under the Scheme, those stocks listed under the BSE 100 or CNX 100, or those of public sector undertakings which are Navratnas, Maharatnas and Miniratnas would be eligible. Follow-on Public Offers (FPOs) of the above companies would also be eligible under the Scheme. IPOs of PSUs, which are getting listed in the relevant financial year and whose annual turnover is not less than Rs. 4000 cr for each of the immediate past three years, would also be eligible.
• In addition, considering the requests from various stake holders, Exchange Traded Funds (ETFs) and Mutual Funds (MFs) that have RGESS eligible securities as their underlying and are listed and traded in the stock exchanges and settled through a depository mechanism have also been brought under RGESS.
• To benefit the small investors, the investments are allowed to be made in installments in the year in which tax claims are made.
• The total lock-in period for investments under the Scheme would be three years including an initial blanket lock-in period of one year, commencing from the date of last purchase of securities under RGESS.
• After the first year, investors would be allowed to trade in the securities in furtherance of the goal of promoting an equity culture and as a provision to protect them from adverse market movements or stock specific risks as well as to give them avenues to realize profits.
• Investors would, however, be required to maintain their level of investment during these two years at the amount for which they have claimed income tax benefit or at the value of the portfolio before initiating a sale transaction, whichever is less, for at least 270 days in a year. The calculation of 270 days includes those days pursuant to the day on which the market value of the residual shares /units has automatically touched the stipulated value after the date of debit.
• The general principle under which trading is allowed is that whatever is the value of stocks / units sold by the investor from the RGESS portfolio, RGESS compliant securities of at least the same value are credited back into the account subsequently. However, the investor is allowed to take benefits of the appreciation of his RGESS portfolio, provided its value, as on the previous day of trading, remains above the investment for which they have claimed income tax benefit.
• For the purpose of valuation of shares, the closing price as on the previous day of the date of trading will be considered so that new investors are certain about their debits and credits into the account.
• In case the investor fails to meet the conditions stipulated, the tax benefit will be withdrawn.
• The deduction from taxable income available under the scheme can be claimed under Section 80CCG of Income Tax Act.