The government today announced measures to revive economic growth and markets including the withdrawal of higher taxes for foreign portfolio investors (FPIs) and said it would release funds for bank recapitalisation upfront. Finance Minister Nirmala Sitharaman told reporters the government had decided to withdraw the surcharge on FPIs which she had unveiled in her budget earlier this year. The Centre also announced the release of funds to recapitalise public sector banks. The Finance Minister also announced that the 'angel tax' provision will be withdrawn for startups and their investors.
Here are the Top Announcements from Nirmala Sitharaman's press brief:
Angel Tax for startups dropped; Section 56(2) (viib) shall not be applicable to startups registered under DPIIT. To mitigate genuine difficulties of startups, the Centre will set up cell led by member of CBDT for addressing problems of startups. Startups with an I-T issue can approach this panel.
The enhanced surcharge on foreign portfolio investors levied in the Budget has also been withdrawn.
Surcharge on long and short term capital gains made from transfer of equity shares has also been withdrawn. "Pre-budget position is restored," Nirmala Sitharaman said.
Rs 70,000 crores upfront to be released as additional lending and liquidity. Banks decided to pass on rate cuts through MCLR reduction.
All pending GST refund due to Ministry of Micro, Small and Medium Enterprises will be paid in 30 days from today. In future every refund will be done in 60 days. The Trade Receivable Discounting System (TReDs) will use the GST Network system. Uniform definition of MSMEs is also being considered.
BSIV vehicles purchased till 31.03.2020 to remain operational till period of registration. Revision of one-time registration fees put off till June 2020. There will also be an additional 15 per cent (Total 30 per cent) depreciation on all vehicles till 31.03.2020. Ban on purchase of new vehicles for the government lifted.
Tax scrutiny will be randomised from Vijay Dashami day, one odd over-enthusiastic officer won't be able to harass anybody. Filing returns will be simplified. Action will be taken against people gaming the system. Tax scrutiny will be faceless.
There will be online tracking of loan applications by customers. To reduce harassment and bring in efficiency, loan documents have to be returned in 15 days of loan closure. Banks have decided to launch repo-rate linked interest rates - means reduced EMI housing loans, working capital to be cheaper.
The issue of IT summons will now go through a centralised system. This is one way in which harassment angle can be addressed in favour of the assessee. All old notices issued till now will have to be cleared in 1.5 months.
Corporate Social Responsibility (CSR) violations will not be treated as criminal offence but as a civil offence. An organisation is to be set up to provide credit enhancement for infrastructure and housing. Delayed payments to infrastructure companies to be reviewed.