While the world battles forest fires and virus outbreaks, our economy has been suffering from ailments of its own. India’s GDP growth took a sharp plunge in Q2 of this fiscal to come in at 4.5 per cent, with many experts voicing concerns about a prolonged slowdown period.
The Finance Bill, 2020, has made substantial changes to the manner in which dividends are taxed. Presently, dividends distributed by a company are subject to dividend distribution tax (DDT) at an effective rate of 20.56 percent.
While presenting the Government’s Budget for financial year 2020-21, Hon’ble Finance Minister of India (Hon’ble FM) in her budget speech had announced that government will come out with a tax dispute resolution scheme (Vivad Se Vishwas) wherein taxpayers will get complete waiver of interest and penalty by paying only the disputed taxes within prescribed time. To that effect, the government has introduced ‘The Direct Tax Vivad Se Vishwas Bill, 2020’ (Scheme) in the Parliament on 5 February 2020.
With an aim to discourage cash transactions and move towards a cashless economy, the first budget of Modi Government 2.0 has proposed to levy TDS @2% on cash payments in excess of Rs. 1 CR in aggregate made during the year, by a banking company or corporate bank of post office, to any person from one or more accounts maintained by the recipient.
The Mumbai bench of the Income Tax Appellate Tribunal (Tribunal), in the recent case of Essar Teleholdings Limited (Taxpayer), has allowed the Taxpayer's claim for set-off of short term capital loss (Loss) on sale of compulsory convertible debentures (CCDs) to its holding company (Hold Co) against long term capital gains earned on sale of shares. The Tribunal reversed the orders of the tax authorities who had denied the Taxpayer's claim by holding that the transaction was not bonafide and was a 'colourable device'.
The tax rates and income slabs under the Income-tax Act, 1961 (IT Act) remain the same, other than the following proposed changes.
It’s that time of the year again, when the fiscal deficit and taxation regimes begin to feature in dinner table conversations around the country. The Union Budget is just around the corner; and with the economy slowing down, taxpayers are looking to the government for some relief. Several reports have mentioned that taxpayers are hoping for rationalisation of tax rate, increase in tax incentives and simplification of tax compliances.
In this roundtable discussion, we explore the current transfer pricing landscape in Egypt, India and United States.
In a few days, our Finance Minister (FM) will be presenting the Union Budget in the backdrop of not just a slowdown in the economy, but also falling direct tax revenues compared to FY 2019 (if collection trends till 15 January were to continue), with the latter being a first in the past 20 years.
In the recent ruling (dated 31 December 2019) of ITO v APJ Construction Private Limited (ITA No. 722/Del/2015) (Ruling), the Income Tax Appellate Tribunal (Tribunal), has held that the tax officer’s (Assessing Officer) characterisation of primary share capital infusion as ‘not clean money’ was accurate as the taxpayer company (issuer) had not clarified the doubts as to the genuineness of the ‘identity’ and ‘creditworthiness’ of the share applicants or ‘genuineness of the transaction’.
