<ul><li>Union <keyword id="19955368" type="General" weightage="100" keywordseo="budget-2024" source="keywords">Budget 2024</keyword> to be presented on July 23, 2024, at 11 am</li><li>Changes in the new <keyword id="19901478" type="General" weightage="20" keywordseo="income-tax" source="keywords">income tax</keyword> regime possible in the budget </li><li>Budget is a detailed estimate of the government's revenue and expenses</li></ul>Next week, Nirmala Tai will present the 2024 <keyword id="19908389" type="General" weightage="20" keywordseo="union-budget" source="keywords">union budget</keyword>. While the internet is already abuzz with the endless expectations of different industries and sectors, what the common man wishes for, and more, are we aware of how the budget comes to life in the first place? What do some of its terms like expenditure and revenue budgets even mean? And what exactly is the finance bill? If you have all these questions running through your mind, here's a ready reckoner for you, answering all your questions 1. Why should I care about the budget? Most of all, because it holds the answer to how your money will be taxed in the coming financial year, or years. Yes, you can (and perhaps will) choose to gloss over most of it, like when Tai talks about its capital expenditure or allocations made to various ministries. But you should know if there are any major changes introduced in the existing income tax slabs, because that would mean an automatic increase or decrease in your taxes. If there are some deductions or exemption that have just been introduced and can help you reduce your taxable income, you'd certainly want to use it to your benefit, wont you? (Unless you're a stickler for paying high taxes)! But for that, you should first know how your hard-earned money is being taxed, and that is why, you should tune into the <a href="https://www.businessinsider.in/budget/article/budget-2024-a-handy-guide-for-major-terms-around-the-upcoming-union-budget/articleshow/111688482.cms" data-type="tilCustomLink" target="_blank">upcoming union budget</a>. 2. What will happen to Income taxes in this budget? Will they be cut? We wouldn't know anything for sure until July 23rd, but there is news that the new tax regime might be made more attractive for the salaried class by way of increasing the <keyword id="20429578" type="General" weightage="20" keywordseo="standard-deduction" source="keywords">standard deduction</keyword> threshold (which is currently Rs 50,000 for both old and new regime), or by raising the total deduction limit under the old regime from the present Rs 2,00,000. Akhil Chandna, Partner at Grant Thornton Bharat also believes enhancing the standard deduction limit will do a world of good to salaried Indians. "With the introduction of the standard deduction in 2018 and the last increase in 2019 from ₹ 40,000 to ₹ 50,000, it is essential to raise the threshold to ₹75,000 now to align with current living costs and inflation. Raising the standard deduction can help improve people's purchasing power, especially those with fixed incomes like pensions", he said. Krishan Mishra, CEO, FPSB India also wishes for the tax exemption limit under new regime be raised from Rs 7 lakh to Rs 10 lakh, since "it will be a crucial step to encourage savings and investments among the mid-income group and will provide much-needed relief to taxpayers". The government may make the new tax regime more lucrative by enhancing its basic exemption limit (up to which no income tax is payable) from Rs 3,00,000. But that's a lot of MIGHTS, that will have to wait the final bell till 23rd! 3. How is the Budget is prepared? It is a lengthy, long-drawn process, which starts with the finance ministry asking all departments, states, ministries and union territories to give them an estimate of how much money they'd potentially need during the year. In addition to this, they also have to present details of all their revenues and expenditures in the past year. Then begins a super duper long process of consultations and discussions and deliberations and consultations and dialog (you get the gist!), after which the allocations are made. Weeks before the budget presentation, the <keyword id="19956758" type="General" weightage="20" keywordseo="finance-minister" source="keywords">finance minister</keyword> also meets representatives from various industries like agriculture, trade, manufacturing and more to know what they want. Based on that, the budget is fine tuned. 9-10 days before the budget is to be presented in the parliament, a halwa ceremony takes place, which commenced today, marks the start of budget printing. From this time on, the finance ministry staff goes super hush-hush and in lockdown, with no one allowed to leave the ministry premises till the budget is tabled in the parliament. 4. Why did India have 2 budgets this year? Because 2024 was an election year. That is why you saw an <keyword id="547606" type="General" weightage="20" keywordseo="Interim-budget" source="Orion">interim budget</keyword> in February, where the government presented a budget, the aim of which was just to fund its regular expenses and spending over the next 2-3 months, till elections. After the elections, it is the responsibility of the newly elected government to prepare a full-fledged budget. Think of this as borrowing from your friends just to fund your mid-month, small term, interim cash crunch. You pay them back as soon as you get your salary, and your budget is set again (at least for the time being!) 5. What are the various types of budget documents The union budget is a hefty set of documents! There's Annual Financial Statement, which lays out how much money it needs in revenue, and how much does it plan to spend that during the year. There's demands of grants, which tells us how these receipts and expenditures will be utilised by different ministries and departments, down to each scheme. There's the finance bill, which outlines any changes the government intends to make, in order to raise these proposed funds. This primarily includes change in tax structures. Then there is appropriation bill, which highlights how the government plans to withdraw money from the consolidated fund of India (where all of government's revenue from income tax, customs and excise and other sources flow in). Once approved, both finance and appropriation bill become acts. The extremely complex sounding "medium term fiscal policy cum fiscal policy strategy statement" has all your important macro- economic indicators like GDP, fiscal deficit, revenue deficit, primary deficit and more. But of course, you can skip through all this to just check out budget at a glance and highlights, which presents the key features and decisions made in the budget in a concise manner. <h4 style="color: rgb(0, 0, 0); font-family: Mulish, sans-serif; font-size: 16px; white-space-collapse: preserve; background-color: rgb(255, 255, 255); text-align: justify;"> </h4>6. What is a revenue and <keyword id="2745241" type="General" weightage="20" keywordseo="expenditure-budget" source="Orion">expenditure budget</keyword>? Think of this as a detailed breakdown of how the government plans to raise money for everything during the year by of tax or non-tax revenues, borrowings and more. The <keyword id="425836" type="General" weightage="20" keywordseo="revenue-budget" source="Orion">revenue budget</keyword> also outlines how much revenue the government had to forego to fund various tax incentives or subsidies. There's no chance you wont spend what you've earned! And so, how the government plans to spend its receipts are mentioned in the expenditure budget. It highlights what each ministry gets, how much money will be spent on a certain scheme and more. 7. What is a populist budget? No, its not another budget document, but just a fancy name for a budget that is prepared with the sole intention to appeal to the people by slashing down income taxes, increasing subsidies and spending more on social schemes. Such a budget might seem lucrative in the short run, but it do not contribute to the country's long-term economic development in any way. On the contrary, it only adds to the overall fiscal burden of the country. Its as if a character came in for a short cameo in your favorite series, won people's hearts, and then vanished into thin air, with no meaningful contribution to the story line. You'd feel short-changed, wont you? So, time to listen to Nirmala Tai and the budget's humdrums with some understanding and interest! Also read: <a href="https://www.businessinsider.in/budget/news/budget-2024-how-will-budget-affect-indias-position-in-the-global-space-race/articleshow/111855546.cms" data-type="tilCustomLink" target="_blank">Budget 2024: How will budget affect India’s position in the global space race?</a> <a href="https://www.businessinsider.in/budget/article/despite-pandemic-and-growing-health-scares-indias-budget-share-for-healthcare-continues-to-decline/articleshow/111807009.cms" data-type="tilCustomLink">Despite pandemic and growing health scares, India’s budget share for healthcare continues to decline</a>

Union Budget 2024: A handy FAQ guide to decode the upcoming budget

The Indian technology sector saw 87 deals valued at $1.4 billion in the third quarter this year, a 40 per cent surge in values over the previous quarter, a report showed on Thursday. The deal volumes, however, fell by 13 per cent in the July-September period. The rise of <keyword id="15777223" type="General" weightage="20" keywordseo="generative-ai" source="Orion">generative AI</keyword> is reshaping the industry, with prominent tech players actively embracing and leveraging this technology to enhance efficiency across various sectors, said the report by Grant Thornton Bharat. "With a substantial 88 per cent decrease in deal values compared to the previous year, the tech industry must consider re-evaluating investment strategies. Emphasising innovation in areas like spacetech, <keyword id="6395918" type="General" weightage="20" keywordseo="saas" source="Orion">SaaS</keyword>, AI, and cloud, investors can navigate the evolving landscape," said Raja Lahiri, Partner and Technology Sector Leader, Grant Thornton Bharat. In the mergers and acquisitions sector, the third quarter saw 20 deals valued at $882 million, reflecting a 9 per cent decline in volumes compared to the previous quarter but a substantial 573 per cent increase in deal values. <keyword id="103425" type="General" weightage="20" keywordseo="mapmyindia" source="Orion">MapMyIndia</keyword> invested $1.1 million in Mappls KOGO, an AI-driven travel advisor. Agritech start-up Leads Connect secured $60.2 million from BL Agro Industries. The Proximus Group's acquisition of a majority stake in <keyword id="3519758" type="General" weightage="20" keywordseo="route-mobile" source="Orion">Route Mobile</keyword> for $721 million marked the biggest deal in the SaaS market, said the report. In the private equity (PE) landscape, there was a marginal decline in technology deals, with 67 transactions totaling $564 million, reflecting a 14 per cent decrease in volumes and a 37 per cent decline in deal values compared to Q2 2023. Nazara Technologies secured funding from SBI mutual fund schemes for $62.2 million in the technology startup segment. Perfios received a substantial $229 million investment from Kedaara Capital, marking one of the largest B2B SaaS deals of the year. There were three IPOs in the IT sector collectively valued at $253 million in the period.

Indian tech sector sees 40% surge in deal values in Q3

India's market regulator, <keyword id="35210" type="General" weightage="20" keywordseo="sebi" source="Orion">Sebi</keyword>, has empanelled 34 entities, including Ernst &amp; Young LLP, Deloitte Touche Tohmatsu India LLP and Grant Thornton Bharat LLP to conduct forensic investigation of mutual funds, their asset management companies (<keyword id="113578" type="General" weightage="20" keywordseo="amcs" source="Orion">AMCs</keyword>) and trustees. KPMG Assurance and Consulting Services LLP, Chokshi &amp; Chokshi LLP, Nangia &amp; Co LLP and Pipara &amp; Co LLP are among the other empanelled entities, the Securities and Exchange Board of India (Sebi) said in a latest update. The period of empanelment is from September 20, 2023 to September 19, 2026, it added. These 34 entities have been empanelled after evaluation of all the applications in response to Expression of Interest (EoI) invited by the capital markets regulator in February. The entities are required to undertake acquisition, extraction and analysis of digital evidence from mobile, computers, tablets, hard drives and USB drives. Also, they need to prepare and submit a report mentioning the findings and conclusions of the analysis. In July, Sebi increased the role and accountability of the mutual fund trustees in a bid to safeguard unitholders' interest amid the growing scale of the mutual fund industry. Also, the regulator specified the "core" responsibilities of trustees of a mutual fund, wherein they will have to ensure that AMCs have adequate systems to prevent mis-selling to increase their assets base.

Sebi empanels 34 entities for conducting forensic investigation of mutual funds, AMCs, trustees

New Delhi [India], January 31 (ANI): President Droupadi Murmi, addressing a joint sitting of <keyword id="19895397" type="General" weightage="20" keywordseo="parliament" source="keywords">Parliament</keyword> on Wednesday, asserted that 2023 was a historic year for the country when it maintained the tag of being the fastest-growing major economy. "The year 2023 was a historic year for India, when it grew the fastest among major economies despite global crisis. India grew about 7.5 per cent for two consecutive quarters," she told the Parliament, on behalf of the central government. The Indian economy grew 7.8 per cent and 7.6 per cent, respectively, during the April-June and July-September quarter of the current financial year 2023-24, thus remaining the fastest-growing major economy. With her address marked the start of the Budget Session of Parliament. Subject to the exigencies of government <keyword id="19933715" type="General" weightage="20" keywordseo="business" source="keywords">business</keyword>, the session may conclude on February 9. This is President <keyword id="19970795" type="General" weightage="20" keywordseo="murmu" source="keywords">Murmu</keyword>'s first address in the new Parliament building. "...This is my first address in the new Parliament building. This grand building has been built at the beginning of the Amrit Kaal. This has the fragrance of 'Ek Bharat, Shreshth Bharat'...This also has the resolve to honour democratic and parliamentary traditions. Besides this, it also has the resolve to build new traditions of the new India of the 21st century," Murmu said. "I am confident that there will be meaningful conversation on policies, in this new building," the President said. Speaking about her government, she said, "The achievements that we see today are the extension of the practices of the last 10 years. We heard the slogan of '<keyword id="20398907" type="General" weightage="20" keywordseo="gareebi-hatao" source="keywords">Gareebi Hatao</keyword>' since our childhood. Today, for the first time in our lives, we see poverty being alleviated on a large scale." Meanwhile, Union Finance Minister Nirmala Sitharaman will present the interim Union Budget on Thursday. The last session before <keyword id="19895394" type="General" weightage="20" keywordseo="lok-sabha" source="keywords">Lok Sabha</keyword> polls expected to be held in April-May this year is to provide a total of eight sittings spread over a period of 10 days. The interim budget typically takes care of the fiscal needs of the intervening period until a government is formed after the Lok Sabha polls. A day before the Session was set to start, Parliamentary Affairs Minister Pralhad Joshi, at an all-party meeting, said the Budget session will mainly be devoted to the Financial Business relating to Interim Union Budget for the year 2024-25 and discussion on the Motion of Thanks on the President's Address. However essential Legislative and other Business may also be taken up during this session. The all-party meeting was attended by 45 leaders from 30 political parties. In addition, he also informed that Supplementary Demands for Grants for the Year 2023-24 in respect of the Union Government will be discussed and voted. Presentation and discussion on Interim Budget of Union Territory of Jammu and Kashmir for 2024-25 along with Supplementary Demands for Grants of Union Territory of Jammu and Kashmir for the financial year 2023-24 will also be taken up and voted. (ANI)

Heard 'Gareebi Hatao' since childhood, today see poverty alleviation on large scale: President Murmu

<ul><li>For self occupied property, <keyword id="6397939" type="General" weightage="20" keywordseo="interest" source="Orion">interest</keyword> deduction is restricted to ₹2 lakhs per annum </li><li>For a rented property, the entire interest amount is a deductible expense. </li><li>You can begin claiming your <keyword id="6354730" type="General" weightage="20" keywordseo="home-loan" source="Orion">home loan</keyword> benefits only once you have received possession. </li></ul>Buying a home is undoubtedly one of the biggest financial commitments in one’s life. And since it is a big ticket purchase, one more often than not needs to take a loan to purchase. <keyword id="35547" type="General" weightage="20" keywordseo="tax-deductions" source="Orion">Tax deductions</keyword> on home loans provide an incentive to people to purchase their own home. We take a look at how home loan tax deductions work in different situations and other rules. <cmsannotation type="cmsannotation" annotationid="Home loan tax deduction for self-occupied and rented properties" comment="Subhead" text="Home loan tax deduction for self-occupied and rented properties">Home loan tax deduction for self-occupied and rented properties</cmsannotation> The <keyword id="6370810" type="General" weightage="20" keywordseo="income-tax-act" source="Orion">Income Tax Act</keyword> provides for deduction of interest on home loan as well as for repayment of principal loan borrowed for acquiring house property. “For self occupied property, interest deduction is restricted to ₹2 lakhs per annum whereas for a rented property, the entire interest amount is a deductible expense,” says Shabala Shinde, Partner, Grant Thornton Bharat. Section 80EEA gives additional exemption of ₹1,50,000 on the payment of interest on home loan. This deduction is available if the loan is taken under the affordable housing scheme. “Interest paid on loans taken before April 1 2022 are eligible to be claimed under Section 80EEA,” says Suneel Dasari, founder and CEO, Eztax.in, a tax filing portal. For repayment of principal amount, the deduction is available against total income and is restricted to ₹1.5 lakhs annually irrespective of the property being let out or self-occupied, under section 80C. However, since section 80C also includes investments like public provident fund (PPF), equity linked savings scheme (ELSS), provident fund contributions and payments like life insurance premiums, you may not be able to utilise the full deduction of ₹1.5 for home loan principal payment. You can also claim a tax deduction on registration and stamp duty paid on the property under section 80C. <cmsannotation type="cmsannotation" annotationid="Tax rules to remember" comment="Subhead" text="Tax rules to remember">Tax rules to remember</cmsannotation> <cmsannotation type="cmsannotation" annotationid="Condition to fulfil for claiming maximum tax deduction on interest paid" comment="Subhead" text="Condition to fulfil for claiming maximum tax deduction on interest paid">Condition to fulfil for claiming maximum tax deduction on interest paid</cmsannotation> Here are a few tax rules one should keep in mind regarding tax deduction on home loans. To qualify for the maximum allowable deduction on loan interest, you must complete the purchase or construction of the house within three years of obtaining the loan. If the acquisition or construction takes longer than three years, your deduction is limited to ₹30,000 instead of the full ₹2 lakhs. <cmsannotation type="cmsannotation" annotationid="Home loan tax benefits can be availed only after possession" comment="Subhead" text="Home loan tax benefits can be availed only after possession">Home loan tax benefits can be availed only after possession</cmsannotation> One can begin claiming your home loan benefits only once the construction of the home is complete, and possession has been handed over by the builder. However, what about the instalments you paid during the construction phase or before you received the keys to your house? According to the rules, you cannot claim a deduction for principal repayment during this period. Still, the interest paid can be accumulated and claimed after you take possession of the property. The law allows for a deferred deduction on the interest paid during the pre-construction period. This deduction on such interest can be availed equally over a span of 5 years, starting from the year in which you take possession of the property. <cmsannotation type="cmsannotation" annotationid="Deduction of interest available on accrual basis" comment="Subhead" text="Deduction of interest available on accrual basis">Deduction of interest available on accrual basis</cmsannotation> You can claim interest deduction on your home loan even if you have missed some EMIs, subject to certain conditions. The Income Tax Act allows for the accrual of interest benefits, meaning that you can accumulate the interest paid during the financial year, including any missed EMIs, and claim it as a deduction in your income tax return. However, it's crucial to ensure that you have proper documentation to prove the interest payments made. However, the deduction of property taxes and interest paid on a home loan are available only on a ‘paid’ basis. <cmsannotation type="cmsannotation" annotationid="Home loan deduction applicable only under old tax regime" comment="Subhead" text="Home loan deduction applicable only under old tax regime">Home loan deduction applicable only under old tax regime</cmsannotation> Home loan tax deduction is available only if you opt for the old tax regime. “Note that in case you opt for the new tax regime for FY 2023- FY2024, you will not be eligible for the deduction under section 24 on interest on home loan as well as 80C deduction for repayment of the principal amount of loan,” says says Adhil Shetty, CEO, BankBazaar.com. Also, in that case, you cannot set off the house property loss against any other head of income.

Home loan tax deductions: Self-occupied vs rented, the differences

<ul><li>A threshold relaxation of ₹7 lakh per financial year from <keyword id="6357150" type="General" weightage="20" keywordseo="tcs" source="Orion">TCS</keyword> has been given only for overseas spending using international debit or credit cards. </li><li>TCS shall be applicable at 20% on forex cards and cash exchanges without any threshold limit unless a specific clarification is issued by the relevant authorities. </li><li>Individuals <keyword id="648371" type="General" weightage="20" keywordseo="travelling-abroad" source="Orion">travelling abroad</keyword> separately or as a family may separately spend amounts up to ₹7 lakh per financial year on credit and debit cards. Group tours are set to cost more.</li></ul>Tax collected at source (TCS), and not the IT giant, was trending earlier in May after the Finance Ministry issued a notification stating that international credit cards would also be covered under the liberalised remittance scheme (LRS) – meaning a TCS of 20% would <a href="https://www.businessinsider.in/personal-finance/news/credit-card-now-under-lrs-ambit-20-tcs-to-be-charged-on-spends-using-international-credit-cards/articleshow/100323990.cms">apply to credit cards as well</a>. After facing a backlash, on May 19, another clarification was issued stating that payments made using international credit and debit cards up to ₹7 lakh shall be excluded from LRS. Hence no TCS shall be applicable on payments made by international credit and debit cards up to ₹7 lakh in a financial year. Any payment beyond ₹7 lakh shall attract TCS at the rate of 20%. However, confusion still prevails, and there is uncertainty on how this will impact foreign travel. People are wondering if there are ways to minimise the impact. We spoke to experts to find out. TCS to apply on forex card, cash exchanges without threshold limit “No specific clarification has been provided on the threshold limits for applicability of TCS on forex cards and cash exchanges, it is assumed that new TCS rules shall apply on forex card and cash exchanges,” says Kunal Savani, partner at law firm Cyril Amarchand Mangaldas. Hence, TCS shall be applicable at 20% on forex cards and cash exchanges without any threshold limit unless a specific clarification is issued by the relevant authorities. Says Suresh Surana, founder of RSM India, an audit, tax and consulting firm, “Assuming that a forex card would generate foreign exchange liability, the same would be covered under the scope of LRS, and TCS under section 206C(1G) would be applicable on the same without the threshold limit of ₹7 lakh as applicable in case of international credit, and debit cards.” TCS @20% applicable on entire amount when booking foreign tours “In case of overseas tours the Finance Act has amended section 206C(1G) of the Income-tax Act, 1961 thereby making TCS applicable on such overseas tours at the rate of 20%. No threshold limit has been provided, and hence a 20% TCS shall be applicable on the whole amount,” says Savani. The tour provider shall collect TCS at 20% in addition to the tour cost. This was introduced in Budget 2023, and has not been amended. It should be noted that the threshold relaxation of ₹7 lakh per financial year (FY) from TCS has been given only for overseas spending using international debit or credit cards. “This relaxation shall not be available for any remittances made from India for tour booking; and TCS on tour operators shall continue to be levied from ₹1,” says Vivek Jalan, partner, Tax Connect Advisory, a professional services firm. For example, if two people are going on a tour, and if the total cost is ₹5 lakh, then this will come under LRS, and the ₹7 lakh exemption will not be applicable. However, if they spend ₹5 lakh overseas on shopping, with international credit or debit cards, then the exemption will be applicable. Exemption applicable on a cumulative basis on all credit, debit cards “The exemption of ₹7 lakh applies to payments made through credit/debit cards only, and not to forex cards. From a reading of the press release, it appears that it is a combined limit applicable to payments made through credit, and debit cards taken together,” says Riaz Thingna, partner, tax, Grant Thornton Bharat, an assurance, tax and advisory firm. So, let us say that when travelling abroad with family in a certain financial year, someone spends ₹5 lakh on a credit card, and ₹5 lakh on a debit card. The first spend of ₹5 lakh from the credit card will not attract TCS as it is below the threshold of ₹7 lakh. The next spend of ₹5 lakh from the debit card will attract TCS in the following manner – there will be no TCS on ₹2 lakh, but a TCS @ 20% will apply on the balance ₹3 lakh. “However, if one uses a forex card, TCS @ 20% will be applicable on the amount of the foreign exchange credited to the forex cards without any exemption limit,” says Riaz. Minimise the impact of TCS on a foreign vacation When booking a tour package, there is no way one can minimise the impact of TCS when travelling abroad. “However, one may book in components, such as flights, hotels, etc., instead of booking a whole tour package,” says Nishant Pitti, chief executive officer and co-founder of EaseMyTrip. If the booking is done through a credit or debit card, one can get the benefit of the exemption limit. Also, LRS is available to all resident individuals including minors. Further, effective 1 July 2023, these new regulations would be applicable on all aggregate card spends above ₹7 lakh in a financial year, calculated separately for each resident individual. “Therefore, individuals travelling as a family/individuals travelling together, may separately spend amounts up to ₹7 lakh per financial year on credit cards, debit cards, while travelling abroad. In that case, TCS would not be applicable since it is below the threshold limit for each individual,” says Rajesh Srinivasan, partner at Deloitte India. If the total spend is exceeding ₹7 lakh, one may use credit or debit cards of different family members for booking to not pay any TCS. How to claim tax credit on TCS From July 1, 2023, Reserve Bank of India (RBI)- authorised banks would need to collect TCS. They would need to file quarterly returns, and provide necessary details including PAN of the Indian resident individual, and the amount remitted under LRS. TCS amount collected by the authorised bank would not be a sunk cost, and can be set-off against the tax payable on the individual’s total income (or) claimed as a tax refund in India. “Once quarterly TCS returns are filed by the authorised bank, the TCS amounts would reflect in Form 26AS of the Indian resident individual. Form 26AS refers to taxpayer’s records as available to the income-tax office, and contains details of taxable amounts remitted, and corresponding TDS and TCS,” says Srinivasan. TDS refers to tax deducted at source. He says that, therefore, no separate records need to be maintained by the Indian resident individual to claim tax credit later. Based on the Form 26AS (available in the individual’s login on the income-tax portal), the Indian resident individual can claim TCS as a tax credit or tax refund, while filing his/her income-tax return for the financial year. Also, the Indian government recently announced that it intends to automate the process of granting immediate TCS credit in case of salaried taxpayers. “The government proposes to link, and grant 20% TCS as credit against the monthly TDS due on the salary income of taxpayers. Procedures, and further announcements in this regard are expected in the coming weeks,” says Srinivasan. However, there is something that one needs to keep in mind. “The foreign exchange spend should be in proportion to the earnings. A person who spends say ₹10 lakh on a personal foreign tour in a fiscal year cannot declare an income of say just ₹12 lakh, or for that matter ₹15 lakh, all other things being constant,” says Jalan. TCS will make foreign tour packages more expensive upfront. However, the good news is that you can avoid TCS on your expenditures abroad, and get a tax credit easily in case you pay any TCS. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/entertainment/news/ott-releases-to-watch-for-june-2023/articleshow/100643939.cms">OTT releases to watch for June, 2023</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/sports/news/icc-top-brass-seeks-pcb-assurances-that-it-will-send-team-to-india-for-odi-world-cup/articleshow/100643947.cms">ICC top brass seeks PCB assurances that it will send team to India for ODI World Cup</a>

New TCS regulations may pinch your wallet while travelling abroad. Here’s how you can minimise the impact

<ul><li><keyword id="6368202" type="General" weightage="20" keywordseo="Credit-card" source="Orion">Credit card</keyword> spends outside India will also get roped within the ambit of the overall cap of $250,000. </li><li>Any credit card purchase overseas will now attract <keyword id="6357150" type="General" weightage="100" keywordseo="tcs" source="Orion">TCS</keyword> if it is not meant for purposes of education or medical treatment. </li><li>TCS will also apply when you pay for subscription of international magazines, through your credit card.</li></ul>The Central government has amended the rules under the Foreign Exchange Management Act to bring credit card spending outside of India under the ambit of the Liberalised Remittance Scheme (LRS). Consequently, starting from July 1, such credit card transactions will be subject to a higher rate of tax collected at source (TCS) at 20%. The Central government, in collaboration with the Reserve Bank of India, effected the amendment through a notification this week. <cmsannotation type="cmsannotation" annotationid="What it means" comment="subhead" text="What it means">What it means</cmsannotation> In Budget 2023-24, the government raised the TCS on expenses under LRS to 20% without any threshold, for all expenses excluding education and medical treatment. Currently LRS has a limit of $250,000 (around ₹2 crore), and any remittance above this needs approval from the Reserve Bank of India (RBI). “By virtue of this notification, payments made through international credit cards outside India will fall within the purview of the LRS scheme. This essentially means that credit card spends outside India will also get roped within the ambit of the overall cap of $250,000. This is irrespective of the fact that whether such spends are for personal or business purposes and there is a consequential TCS impact,” says Riaz Thingna, partner, Grant Thornton Bharat LLP. This means that individuals with high spending on international transactions will now need to carefully plan their foreign remittances to ensure compliance with the regulations and avoid any violation of norms. <cmsannotation type="cmsannotation" annotationid="Travel to become more expensive, even if you plan it yourself" comment="subhead" text="Travel to become more expensive, even if you plan it yourself">Travel to become more expensive, even if you plan it yourself</cmsannotation> While the above may not apply to most people, the new rule means that any credit card purchase overseas will now attract 20% TCS if it is not meant for purposes of education or medical treatment. Previously, the use of international credit cards for expenses incurred during trips abroad was not considered part of the liberalised remittance scheme (LRS). “In order to apply TCS on foreign remittances and foreign spends under LRS, an amendment was proposed in Section 206C(1G) of the Income Tax Act wherein TCS @20% was proposed on remittances for foreign spends. The payment for these foreign spends could also be made via international credit cards, which was not under RBI scanner apropos Rule 7 of FEMA Rules 2000,” says Vivek Jalan, partner, Tax Connect Advisory. Rule 7 of FEMA (Foreign Exchange Management Act) Rules 2000 pertains to the prohibition on transactions in foreign exchange, foreign security, and immovable property by a person resident outside India “The finance minister while answering in the Parliament asked the RBI to find out ways by which this could also be tracked by deleting this Rule 7 of FEMA (Current Account Transaction) Rules 2000 all foreign spends even by international credit cards will also be liable to TCS @20%,” says Jalan. Post the budget announcement, only package tours were subject to 20% TCS. Now that is no longer the case. TCS will apply even if you plan a foreign trip on your own. When one travels abroad one needs to make a lot of payments. For example, when travelling to Paris, an entry to a museum could cost you €100. You would have to pay TCS on that, even if you book it from India with a credit card before you travel. Also, if you buy a Starbucks latte or take an Uber when travelling abroad, you have to pay 20% TCS. TCS will also apply when you pay for subscription of international magazines, through your credit card. “Another impact is that when travelling abroad, you can use your credit card only till 80% of your credit limit. You can get a tax credit on this, but it will affect your cash flow,” says B. Srinivasan, director and founder, Shree Sidvin Investment Advisors. For example, since the banks will be using 20% as TCS, if one has a ₹5 lakh credit limit, one can only use ₹4 lakh. Also Jalan clarifies that spends via international debit cards and travel cards would continue to be liable under TCS, since they were never outside the ambit of TCS under Rule 7 of FEMA Rules 2000.

Credit card now under LRS ambit – 20% TCS to be charged on spends using international credit cards

<ul><li>Salaried individuals who have started their careers can file their taxes on their own, as the e-filing portal has been simplified over the last few years. </li><li>Based on the deductions one can avail, one needs to decide whether to opt for the old or the new tax regime. </li><li>It is important to add all <keyword id="672797" type="General" weightage="20" keywordseo="interest-income" source="Orion">interest income</keyword> from savings accounts, fixed deposits, etc, and declare it when filing taxes. </li></ul>It is that time of the year again – when we have to file our taxes. While we can take the services of a professional to help us file our taxes, many of us may prefer doing this on our own since the process has been simplified in recent times. While many of us may be overwhelmed by the perceived complexity of filing taxes, it need not be such a difficult task. If you have just started working and/or if you have limited sources of income, you can easily file your returns on your own. “Salaried individuals who have started their careers can file their taxes on their own, as the e-filing portal has been simplified from the last few years. A lot of information is pre-filled when one files their India tax return," says Akhil Chandna, partner, Grant Thornton Bharat, a professional services firm. If an individual has a limited number of income sources such as salary, interest from deposits with banks, etc, and has a basic understanding of the tax laws and regulations, she can choose to file her taxes on her own. Chandna says that if you are filing your own taxes, here are some of the things that you need to do. <cmsannotation type="cmsannotation" annotationid="subhead" text="Gather all the necessary documents:">Gather all the necessary documents:</cmsannotation> Collect your salary slips, bank statements, Form 16, investment receipts, any donations made, rent receipts, Form 26AS, AIS/TIS etc, and have them all in one place. <cmsannotation type="cmsannotation" annotationid="subhead" text="Choose the correct Income Tax Return (ITR )Form:">Choose the correct <keyword id="104359" type="General" weightage="20" keywordseo="income-tax-return" source="Orion">Income Tax Return</keyword> (ITR )Form: </cmsannotation>There are different tax forms applicable for different types of income, so it is important to know <a href="https://www.businessinsider.in/personal-finance/news/which-itr-form-should-you-use-to-file-your-taxes/articleshow/100964135.cms">which form is required to be filled</a>. Choosing an incorrect form may result in an error in filing returns, necessitating a revision of the tax return. <cmsannotation type="cmsannotation" annotationid="subhead" text="Selecting the old or the new tax regime:">Selecting the old or the new tax regime:</cmsannotation> From Budget 2023-24, the new tax regime is the default tax regime. The new tax regime has a revised set of slabs that can reduce tax outgo. However, most of the deductions like 80C, 80D, and deductions on home loan principal, and interest repayment are not available under the new tax regime. For this reason, many<a href="https://www.businessinsider.in/personal-finance/news/investments-like-elss-ppf-and-tax-saving-fixed-deposits-are-likely-to-lose-their-sheen-in-new-tax-regime/articleshow/100464933.cms"> popular tax-saving investments</a> have lost their charm under the new tax regime. Therefore, it is important to consider all the available deductions, and choose the right tax regime. In most cases, if you do not have a home loan – which you are not likely to have when you start your job – the <a href="https://www.businessinsider.in/personal-finance/news/how-to-take-home-loan-benefit-in-2023-24/articleshow/99575363.cms">new tax regime</a> would make more sense. <cmsannotation type="cmsannotation" annotationid="subhead" text="Disclosures to be made:">Disclosures to be made: </cmsannotation>Where applicable, these disclosures need to be made: bank accounts, assets and liabilities schedule, schedule of foreign assets, number of days’ presence in India, details of directorships, unlisted shares, etc. <cmsannotation type="cmsannotation" annotationid="subhead" text="Common mistakes to avoid">Common mistakes to avoid</cmsannotation> <keyword id="189207" type="General" weightage="20" keywordseo="tax-filing" source="Orion">Tax filing</keyword> involves many steps, and there are some mistakes that one may be making. This is how you can avoid them: <cmsannotation type="cmsannotation" annotationid="subhead" text="Not declaring interest income:">Not declaring interest income:</cmsannotation> “Remember to declare the interest on savings bank a/c, income tax refund (if any), etc, in your income. Many times, people miss out on the same,” says Vivek Jalan, partner, Tax Connect Advisory. He adds that interest on fixed deposits/debentures/etc as available in Form 26AS/AIS should be declared as income. There may be a difference in the amounts reported in 26AS, and what you actually receive in your bank account due to the fact that interest accrues periodically, but may be paid only on maturity. However, TDS (tax deducted at source) may be cut on an accrual basis. <cmsannotation type="cmsannotation" annotationid="subhead" text="Not disclosing exempt income:">Not disclosing exempt income:</cmsannotation> All income must be disclosed, irrespective of whether it is taxable or exempt. Many taxpayers, out of ignorance, fail to provide details of proceeds from life insurance policies or gifts from relatives, which are exempt from tax. Though such income is not liable to be taxed, however, it’s mandatory to disclose this income in your tax return. <cmsannotation type="cmsannotation" annotationid="subhead" text="Not e-verifying tax returns on time:">Not e-verifying tax returns on time:</cmsannotation> The timeline to e-verify tax returns has been reduced from 90 days to 30 days for all tax returns being filed after 01 August 2022. Therefore, one should e-verify the tax return immediately after filing the tax return. <cmsannotation type="cmsannotation" annotationid="subhead" text="When in doubt, seek help from a professional">When in doubt, seek help from a professional</cmsannotation> India is the second-most complicated tax jurisdiction in Asia Pacific after China. “It has become all the more complicated with the massive data analytics and data mining conducted by the Income Tax Department and also sharing of the data between various agencies like banks, investment vehicles, GST, etc,” says Jalan. Incorrectly filing taxes may result in a tax notice. While you can file your own taxes, especially if you have just started your career, you should be sure to seek the guidance of a tax expert in case of doubts.

Looking to file taxes on your own? Here is what you need to keep in mind

<ul><li><keyword id="15456120" type="General" weightage="100" keywordseo="presumptive-taxation" source="Orion">Presumptive taxation</keyword> scheme is aimed to reduce the compliance burden on small businesses and professionals.</li><li><keyword id="6354751" type="General" weightage="20" keywordseo="income-tax" source="Orion">Income tax</keyword> provisions allow eligible <keyword id="59866" type="General" weightage="20" keywordseo="taxpayers" source="Orion">taxpayers</keyword> to calculate their taxable income at specified rates and pay tax accordingly.</li><li>Taxpayers opting for presumptive taxation do not have to maintain detailed books of accounts.</li><li>Business Insider India spoke to tax experts to decode and simplify what presumptive taxation is all about and how it is different from regular taxation provisions.</li></ul>Running a small business or a professional service can often involve a single person or a few people juggling many tasks. To allow them to focus on core business, there is a special provision of presumptive taxation in the <keyword id="6370810" type="General" weightage="80" keywordseo="income-tax-act" source="Orion">Income Tax Act</keyword> that simplifies the process of tax assessment. The presumptive taxation scheme allows you to pay tax based on your presumptive income. This makes filing income tax returns easier and allows small taxpayers under this scheme to pay taxes based on an estimated income instead of keeping a track of every single receipt and payment. Simply put, the presumptive taxation scheme significantly reduces the overhead that is usually involved in maintaining books of accounts and following compliances. “Under presumptive taxation, taxpayers declare their income or profit based on a presumptive rate, which is fixed by the tax authorities. This rate is generally lower than the actual rate, which allows taxpayers to pay lower taxes,” Sanjiv Bajaj, joint chairman &amp; managing director, Bajaj Capital, told Business Insider India. <cmsannotation type="cmsannotation" annotationid="How is presumptive taxation different?" comment="subhead" text="How is presumptive taxation different?">How is presumptive taxation different?</cmsannotation> Presumptive taxation allows taxpayers to declare income at or above the rate specified under the relevant provisions of the Income Tax Act, 1961. It also reduces the compliance burden on taxpayers, as they do not have to maintain detailed books of accounts, which is mandatory under the regular tax provisions. Explaining the difference between the two, Akhil Chandna, partner, Grant Thornton Bharat LLP, said, “Regular taxation computes taxable income after deducting actual expenses incurred; however, in presumptive taxation, the income computed at the presumptive rate is the final taxable income, with no further deduction of expenses allowed.” It is worth noting that certain taxpayers will still have to maintain a few books of accounts like a cash book, journal, ledger and in case of doctors, a register of patients, stock details of medicines, etc. <cmsannotation type="cmsannotation" annotationid="Who is eligible for this scheme?" comment="subhead" text="Who is eligible for this scheme?">Who is eligible for this scheme?</cmsannotation> Presumptive taxation is available to the following types of taxpayers under the Income Tax Act, 1961: <table style="border-width: initial; border-style: none;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Section </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Eligible assessee </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Turnover/Gross receipts </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">44AD </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Resident individual, resident Hindu Undivided Family (HUF), resident partnership firm other than LLP engaged in eligible business </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2 crore (₹3 crore* from AY24-25) </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">44ADA </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Resident individual, resident Hindu Undivided Family (HUF), resident partnership firm other than LLP engaged in any profession </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹50 lakh (₹75 lakh* from AY24-25) </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">44AE </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Any person engaged in the business of plying, hiring or leasing of goods carriages, not more than 10 during the year </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Light goods vehicle - ₹7,500 per vehicle per month Heavy goods vehicle - ₹1,000 per vehicle per month </td></tr></tbody><tbody></tbody></table> Source: Income Tax Act, 1961 | *enhanced limits applicable only if 95% of the receipts are through online modes “For taxpayers opting for presumptive taxation under Section 44AD or 44ADA, only one advance tax installment is payable before March 15 of the concerned financial year,” Chandna added, explaining another benefit of the presumptive taxation scheme. <cmsannotation type="cmsannotation" annotationid="How to compute taxable income under presumptive taxation?" comment="subhead" text="How to compute taxable income under presumptive taxation?">How to compute taxable income under presumptive taxation?</cmsannotation> Computing taxable income under the presumptive taxation scheme is very simple. <table style="border-width: initial; border-style: none;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Section </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Computation of taxable income </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">44AD </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Cash receipts - 8% Receipts through digital modes - 6% </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">44ADA </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">50% of gross receipts </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">44AE </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Light goods vehicle - ₹7,500 per vehicle per month Heavy goods vehicle - ₹1,000 per vehicle per month </td></tr></tbody><tbody></tbody></table> Source: Income Tax Act, 1961 Taxpayers opting for presumptive taxation cannot claim any expenses incurred as a deduction. Additionally, they do not have to get their books of accounts audited. However, if their declared income is lower than the rates prescribed, an audit may be required. <cmsannotation type="cmsannotation" annotationid="What is the tax rate under presumptive taxation?" comment="subhead" text="What is the tax rate under presumptive taxation?">What is the tax rate under presumptive taxation?</cmsannotation> Chandna further explained that the tax rate under presumptive taxation is the same as it is under regular taxation. This means that once the taxable income is calculated, tax liability will be computed according to the applicable slab rates. For example, a taxpayer has gross receipts of ₹30 lakh and opts for presumptive taxation under section 44ADA. According to provisions, the taxable income will be ₹15 lakh. The tax liability on this will be arrived at using slab rates. As per slab rates applicable for PY 2022-23 (AY 2023-24), the total tax liability is ₹2.73 lakh. 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Presumptive taxation: The scheme that eases burden on small businesses

<ul><li>The Indian government today unveiled its vehicle scrappage policy to take old, unfit and polluting vehicles off the road.</li><li>The policy offers incentives to owners of these vehicles in the form of reduced road taxes and waiver of registration charges on their subsequent vehicle purchase.</li><li>The government aims to attract investment to the tune of ₹10,000 crore and generate over 35,000 jobs in the process.</li></ul>In a virtual address during an investor summit in Gujarat, India’s Prime Minister Narendra <keyword id="6354642" type="PERSON" weightage="20" keywordseo="Modi">Modi</keyword> announced the <keyword id="3393307" type="PERSON" weightage="20" keywordseo="Voluntary-Vehicle-Fleet-Modernisation-Programme">Voluntary Vehicle Fleet Modernisation Programme</keyword>, or the vehicle scrappage policy. This, Modi said, will attract investment to the tune of ₹10,000 crore. The vehicle scrappage policy has been in the works since 2015. It provides incentives to owners of old, unfit and polluting vehicles to scrap them and make the roads cleaner, and reduce raw material costs for manufacturers. Union Minister for <keyword id="61316" type="ORGANIZATION" weightage="20" keywordseo="Road-transport">Road Transport</keyword> and Highways, Nitin Gadkari, said that this policy has the potential to cut down raw material costs by 40%. This could eventually lead to a reduction in prices of vehicles for customers. The scheme will be kickstarted with government vehicles that are 15 years and older, by April 2022. It will be expanded to unfit heavy commercial vehicles from 2023, and personal vehicles older than 20 years will be covered from June 2024. <cmsannotation type="cmsannotation" annotationid="Buyers can expect discounts, other incentives" comment="subhead" text="Buyers can expect discounts, other incentives">Buyers can expect discounts, other incentives</cmsannotation> Automobile customers can also expect some rationalisation in the prices of vehicles, but the extent of benefits that the manufacturers pass on to buyers eventually is not known yet. “The association of automobile manufacturers is also going to offer some discount on the purchase of new vehicles and the certificate of deposit for the scrapped vehicles,” said Giridhar Aramane, secretary in the <keyword id="168381" type="ORGANIZATION" weightage="20" keywordseo="ministry-of-road-transport">Ministry of Road Transport</keyword> and Highways. In addition to this, Aramane added that buyers will benefit from a 25% reduction in road taxes, and a complete waiver of registration fees when purchasing a new vehicle next time. <cmsannotation type="cmsannotation" annotationid="Vehicle scrappage policy to benefit various stakeholders" comment="subhead" text="Vehicle scrappage policy to benefit various stakeholders">Vehicle scrappage policy to benefit various stakeholders</cmsannotation> The government believes that this policy will help generate employment for 35,000 people at vehicle fitness centres and scrapyards. A Grant Thornton report dated August 11 said that this policy will result in benefits for several sectors. "Be it generating employment, reducing pollution, or accelerating demands for electric vehicles, the policy proves to be a win-win situation for the auto industry and various other stakeholders," the report said. The report added that the metal recycling business will be one of the major gainers. "One of the key opportunities that will emerge from the vehicle scrappage policy will be for the metal recycling business. It will also to an extent reduce the cost of production. Steel is a crucial component for automobile manufacturers, and its price has been growing up to almost 30% in the last six months," said Saket Mehra, Partner and Automotive Sector Leader, Grant Thornton Bharat. <cmsannotation type="cmsannotation" annotationid="Scrapping industry unorganised in India" comment="subhead" text="Scrapping industry unorganised in India">Scrapping industry unorganised in India</cmsannotation> Stating that the scrapping industry in India is unorganised and uses manual labour to dismantle machinery, Aramane said that this leads to serious economic loss. Official estimates <a href="https://timesofindia.indiatimes.com/business/india-business/vehicle-scrapping-policy-to-offer-about-5-rebate-on-new-cars-nitin-gadkari/articleshow/81569841.cms">suggest</a> that there are over 10 million motor vehicles in the country, which are either older than 15 years or don’t have fitness certificates. “We want to modernise this process through a modern automated scrapping centre where vehicles will be deregistered before scrapping with the help of regional transport offices (RTOs), component by component, which can generate better value. This will reduce raw material costs, increase the availability of raw materials such as rare earths and other metals,” Aramane added. SEE ALSO: <a href="https://www.businessinsider.in/business/auto/news/ola-scooter-launch-date-set-for-august-15/articleshow/84997219.cms">Ola Scooter launch date set for August 15 – here’s everything you need to know</a> <a href="https://www.businessinsider.in/business/auto/news/simple-energy-launching-one-electric-scooter-on-august-15-check-out-booking-price-battery-specification/articleshow/85268668.cms">Simple One electric scooter pre-bookings begin August 15 – check out the booking price, battery specs and more</a> <a href="https://www.businessinsider.in/business/auto/news/simple-energy-new-electric-scooter-promises-240km-range-on-a-70-minute-charge/articleshow/84164967.cms">This new electric scooter promises 240KM range on a 70-minute charge, could be priced under ₹1,20,000</a>

Indian government announces vehicle scrappage policy, aims to generate 35,000 jobs and attract ₹10,000 crore investment

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Indian tech sector sees 40% surge in deal values in Q3

IANS

Sebi empanels 34 entities for conducting forensic investigation of mutual funds, AMCs, trustees

PTI

Heard 'Gareebi Hatao' since childhood, today see poverty alleviation on large scale: President Murmu

ANI

Home loan tax deductions: Self-occupied vs rented, the differences

Anagh Pal

New TCS regulations may pinch your wallet while travelling abroad. Here’s how you can minimise the impact

Anagh Pal

Credit card now under LRS ambit – 20% TCS to be charged on spends using international credit cards

Anagh Pal

Looking to file taxes on your own? Here is what you need to keep in mind

Anagh Pal

Presumptive taxation: The scheme that eases burden on small businesses

Rounak

Anagh

Indian government announces vehicle scrappage policy, aims to generate 35,000 jobs and attract ₹10,000 crore investment

Rounak Jain