Union Budget 2022 - Lenstax

INCOME TAX & CUSTOMS

• AMT reduced from 18.5% to 15% for co-operative society.
• Surcharge rate reduced from 12% to 7% on co-operative society having total income less than Rs. 10 crores.
• Maximum surcharge on long-term capital gain on transfer of equity shares is capped at 15%.
• Health and Education Cess on income and profit is not allowable as business expenditure.
• No benefit of set-off of loss allowable on income discovered during search and seizure.
• Filing of an updated return within 2 years from the end of the relevant assessment year on payment of additional tax allowed.
• Income from the transfer of Virtual Digital Asset (Crypto, NFT’s) shall be taxed at 30% with no deductions of expenses except cost of acquisition.
• Gift of Virtual Digital Assets to be taxed in receiver’s hand.
• TDS on payment made in relation to transfers of virtual digital asset at the rate of 1 percent of such consideration above a monetary threshold.
• Sec. 115 BAB Incentives for newly incorporated manufacturing entities under concessional tax regime extended to 1 more Year i.e. 31.03.2024.
• Customs Duty on Gems and Diamonds reduced to 5%.

MSME, START UPS AND MAKE IN INDIA

• Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) scheme will be revamped with required infusion of funds. This will facilitate additional credit of Rs. 2 lakh crore for Micro and Small Enterprises and expand employment opportunities.
• ECLGS Guarantee covers to be enhanced to Rs. 5 Lakh Crore.
• Existing Emergency Credit Line Guarantee Scheme (ECLGS) would be extended up to March 2023.
• Raising and Accelerating MSME Performance (RAMP) programme with outlay of 6,000 crore over 5 years will be rolled out.
• Defence R&D will be opened up for industry and Start-ups. 68% of R&D budget in Defence earmarked for Make In India,
• Incentive for Start-ups benefits allowed to start-ups incorporated before (Earlier 31-3-2022 extended to 31-3-2023).
• Start-ups will be promoted to facilitate ‘Drone Shakti’ through varied applications and for Drone-As-A-Service (DrAAS).
• Rs. 19,500 crores allocated to Production Linked Investment for manufacturing of Solar PV modules.

DIGITAL INDIA

• Digital Banking by Post Offices: 100% of post offices to be connected with the core banking system.
• Digital Payments: Scheduled Commercial Banks to set up 75 Digital Banking Units in 75 districts.
• New education channel - One Class 1 TV channel to be launched to give supplementary education to children to make up for the loss of formal education due to COVID-19.
• Digital University will be established for word-class universal education in India.
• Spectrum auctions will be conducted in 2022 to roll out 5G services.
• Optical fibre - Bharat Net optical fibre project to be completed in 2025.
• For affordable broadband services in rural and remote areas, 5% of the annual collection under the universal service obligation fund will be allocated.
• Digital Rupee using blockchain is to be issued by RBI starting 2022-2023.
• Digital health registry to be rolled out.
• End-to-End online e-bill system will be launched for all central ministries for procurements.

INFRA & RAILWAYS

• Draft Detailed Project Report (DPR) for 5 River Linking have been finalized.
• 100 new cargo terminals to be built over the next three years.
• 400 new Vande Bharat trains to be introduced in next 3 years.
• Design of metro system, including civil structure, will be reoriented and standardized.
• Railways will develop new products and efficient logistics for small farmers and small enterprises under the One Station, One Product concept.
• Contracts for implementation of multimodal logistics parks through PPP mode will be awarded in FY 2022-23.
• FM suggests 7 Engines for unison growth of India - Roads, Railways, Airports, Ports, Mass Transports, Waterways and Logistics infrastructure.
• Rs 1 lakh crore financial assistance to be provided to states in 2022-23 to catalyse investments.
• Northeast Infra - PM development initiative for the northeast to fund infra and social development projects.

RURAL & AGRICULTURE

• Har Ghar, Nal Se Jal: 3.8 crore households to be covered in 2022-23, FM allocates 60,000 crores for providing tap water access.
• PM Awas Yojana: 80 lakh houses to be completed in 2022-23, Rs 48,000 crore is allotted for PM Awas Yojana.
• Vibrant Villages Programme: Targeting development of villages on the Northern Border left out from the development gains.
• Use of Kisan drones will be promoted for crop assessment, digitization of land records, spraying insecticides and nutrients.
• Rs. 2.37 lakh crores of MSP value directly transferred to Farmers.
• Start-ups for agriculture and rural enterprise relevant to farm produce will be financed through a co-investment model facilitated by NABARD.
• For better farming, Central government will provide a comprehensive package with state government coordination.
• Railways will develop new products and efficient logistics for small farmers and small enterprises under the One Station, One Product concept.

GOODS & SERVICE TAX

• Time-limit to avail ITC u/s 16(4) extended till 30th November of next year from 30th September.
• Additional Condition for availment of ITC u/s 16(2)- ITC can be availed only if the same is not restricted in GSTR-2B.
• Composition Tax Payer’s Registration can be cancelled suo-moto if they have not filed their GSTR-4 return beyond 3 months from the due date.
• Credit Notes in respect of supply made in a financial year can be issued by 30th November of next financial year (currently allowed till 30th September)
• Any rectification of error in GSTR-1/ GSTR-3B is now permitted till 30th November of next financial year (currently allowed till 30th September).
• Section 47 of the CGST Act is being amended so as to provide for levy of late fee for delayed filing of TCS returns.
• Section 49 of the CGST Act is being amended so as to provide for restrictions for utilizing the amount available in the electronic credit ledger.
• Section 49 of the CGST Act is being amended so as to allow transfer of amount available in E- cash ledger of a registered person to the E- cash ledger of a distinct person.
• Section 49 of the CGST Act is being amended so as to provide for prescribing the maximum proportion of output tax liability which may be discharged through the electronic credit ledger.
• Section 50(3) of the CGST Act is being substituted retrospectively, with effect from the 1st July, 2017, so as to provide for levy of interest on input tax credit wrongly availed and utilized. (Meaning thereby Interest will not be levied if ITC is not utilized).
• Refund claim of any balance in the electronic cash ledger shall be made available.
• Rate of Interest u/s 50(3) prescribed as 18% in all cases.

OTHER HIGHLIGHTS

• Mental Health- National Telemental Health Programme to be launched. including a network of 23 telemental health centres of excellence.
• IBC- Amendments in the IBC to be carried out to enhance the resolution process and facilitate cross border insolvency resolution.
• Social Welfare - Transliteration of land records in 8 languages will be rolled out.
• Due to space scarcity in urban areas for setting up charging stations. Battery Swapping policy will be launched.
• Issuance of E-Passports will be rolled out in 2022-23.
• For women and child development. 2 lakh Anganwadis to be upgraded with better facilities.
• Skilling avenues to be promoted for employment and employability with private players.
• SEZ reforms in customs to be implemented by 30th Sept. 2022.
• Animation Visual Effects. Gaming and Comic (AVGC) offers immense potential to employ Youth.
• AVGC taskforce to be set up.
• India to launch sovereign green bonds. Funds will be used for projects that will help reduce the carbon intensity of the economy.
• Sovereign Green Bonds will be part of the Government’s borrowing programme in FY23.