ASSIGNMENT ON: DIRECT AND INDIRECT TAXESNAME: PURNA KAUR ARORA ROLL NO- 2 SYBMS SUBMITTED TO: PROF.PRASHANT KOTWAL Some of them are highlighted below: y From a direct tax perspective.The Union Budget 2011-12. which a clear timeline on introduction of the Constitution Amendment Bill. the budget is all pervasive in its nature. The best feature of this budget is that. services provided by airconditioned licensed for serving alcohol beverages and accommodation provided by hotels. individual to individual service will not a perform a part of it. has made an impressive statement and promises to be very dynamic in its operations. The service tax area has been broadened with an amendment which has included two other sectors in its purview. . etc. y From an indirect tax perspective. it looks at all sides of development. namely. the introduction of antiabuse provisions to stem the flow of black money and to discourage transactions with jurisdictions which do not cooperate with India for exchange of information was the only significant proposal of the Finance Minister. The desire to implement GST was reiterated. the focus of the budget was on basic rationalization and effecting necessary changes for eventual GST implementation. but however. Coaching or commercial training has also been brought under the purview of service tax. it has made certain vital changes.. Changes in Indirect taxes: The indirect tax proposal is set to go with the Goods and Service Tax (GST). Not only on the direct tax zone but also in the indirect taxation zone. that is. for less than three months. Arbitration services between an organization and individuals have also been brought under the purview of service tax. The rate of service tax has also been increased on air travel. The custom duty which previously used to prevail at various rates of 2%. Both of these shall be applicable for economy class. 250. . In case of µTransport of goods through coastal and inland shipping service¶. 60 lakhs need not get their accounts audited. As for as central excise is concerned the concessional rate of 4% has been now replaced with the new rate of 5%. an abatement of 25% will be available from the taxable value provider. a standard rate of 10% shall be applicable for the passengers. but whereas the other classes are concerned other than the economy class. 2. 50 and all international flights will now cost more by Rs. sugar confectionary. All domestic tickets will now be costlier by Rs. Garments that are branded now face an excise levy of 105% with CENVAT facility. SEZs have been provided with a simplified scheme which reduces the problem of tax-free receipt of services that are consumed within the SEZ zone.5% and 3% has now been done with and a single rate of 2. The same rate shall be applicable for items like pastry and cakes. etc. Individuals and proprietors whose total annual turnover is upto Rs.5% is likely to prevail as a uniform rate. Lower rate of 15 per cent tax on dividends received by an Indian company from its foreign subsidiary.60.000 giving uniform tax relief of Rs. Changes in Direct Taxes: Exemption limit for the general category of individual taxpayers enhanced from Rs.5 per cent on domestic companies proposed to be reduced to 5 per cent. Rate of Minimum Alternative Tax proposed to be increased from 18 per cent to 18. who are 80 years or above. .80.2.5 per cent of book profits.500 crore estimated as a result of proposals. Additional deduction of Rs. Current surcharge of 7.000. System of collection of information from foreign tax jurisdictions to be strengthened. Higher exemption limit for Very Senior Citizens.20.000 to Rs.1. A net revenue loss of Rs.1.11. Benefit of investment linked deduction extended to businesses engaged in the production of fertilizers. Universities and Institutes of Technology to be enhanced to 200 per cent. Weighted deduction on payments made to National Laboratories.000 for investment in long-term infrastructure bonds proposed to be extended for one more year. Exemption limit enhanced and qualifying age reduced for senior citizens. Investment linked deduction to businesses developing affordable housing. Tax incentives extended to attract foreign funds for financing of infrastructure. Also that the pension amount is being raised from Rs 200 at present to Rs 500 per month for those who are 80 years and above. New category of senior citizens above 80 years to get higher IT deduction limit of Rs.5 lakh. 5 lakh from this year Unveiling the Budget proposals for 2011-12 in the Lok Sabha. Senior citizens are now happy as a high new tax slab for senior citizens of 80 years and above was introduced in the budget.800000 800001 and above Rate 0 10 20 30 . New tax slabs Slabs (Rs) upto 250000 250000-500000 500001-800000 800001 and above Rate 0 10 20 30 Old tax slabs Slabs (Rs) 0 .500000 500001 . Senior citizens will get tax exemption for income up to Rs 2. the eligibility for pension will now be reduced to 60 years from 65 years at present. it was also proposed to reduce the age limit for consideration as senior citizens from 65 years to 60 years. Under the on-going Indira Gandhi National Old Age Pension Scheme for Below Poverty Line (BPL) beneficiaries.240000 240001 . 50.00.001 to Rs 5.000 Rs 5.00.000 Rs 5.000 Rs 2.80.000 and above Proposed Tax Rates NIL 10 per cent 20 per cent 30 per cent For Women Up to Rs 1.00.001 to Rs 8.00.001 to Rs 8.00.000 Rs 1.00.000 Rs 8.000 and above Proposed Tax Rates NIL 10 per cent 20 per cent 30 per cent For Senior Citizens of 60 years But less than 80 years Up to Rs 2.80.000 to Rs 8.00.000 Rs 5.00.90.000 Rs 1.000 to Rs 5.000 and above Proposed Tax Rates NIL 10 per cent 20 per cent 30 per cent Very Senior Citizens of 80 Years and Above Up to Rs 5.001 to Rs 5.00.001 to Rs 8.000 Rs 8.00.000 and above Proposed Tax Rates NIL 20 per cent 30 per cent .00.00.90.00.00.50.00.000 Rs 8.000 Rs 5.00.General Tax Payers Up to Rs 1.000 Rs 8. 11.300 crore.1. cash transfer of subsidies are some great ideas.8 lakh from Rs 1.4 lakh and has also reduced the eligibility age for Senior citizens from 65 years to 60 year.500 crore and those related to Indirect Taxes estimated to result in net revenue gain of Rs. To encourage voluntary compliance the penal provision for Service Tax are being rationalised. Proposals relating to Direct Taxes estimated to result in a revenue loss of Rs.6 lakh and for Senior citizen tax a slab increased to Rs 2. .11. Proposals relating to Service Tax estimated to result in net revenue gain. The Budget-2011 implemented some new benefits and also levied a new exemption limit where for Individuals Male Categories which increased to Rs 1.5 lakh from Rs. Similar changes being carried out in Central Excise and Custom laws. Things like GST implementation.9 lakhs Further a new revised income tax return form µSugam¶ has been introduced for small tax payers.2. which will serve as IT infrastructure for introduction of GST. New category for very senior citizens introduced for 80 years and above who will be eligible for Tax limit from Rs 5 lakhs but the Finance minister has not given neither brought in any change for the women assessee and they have no new tax exemption limit which remains unchanged to Rs. Significant progress in establishing GST Network (GSTN).Comments on the changes in direct and indirect taxes: As a statement of good intention. its a very positive budget. The FM Pranab Mukherjee has given the following for small businessmen. . The Union Budget has something good for small investors.500 per day. y Legal representation for businesses under service tax. however. It has given the following for small investors. is likely to be dampener for this class. 10% excise duty on branded garments. y Service tax on hotel accommodation above Rs 1. y To tax life insurance service providers. Tax norms tightened for businessmen The Union Budget has something good for small businessmen. This. Upped priority home loan limit to Rs 25 lakh compared to Rs 20 lakh. html http://www.india.etaxindia.in/events/budget2011.html .html http://www.html http://www.pdf http://taxguru.Bibliography http://www.com/news/tax/union-budget-taxnorms-tightened-for-businessmen-_525563.in/income-tax/budget-201112-impact-personaltaxation-income-tax-calculator.com/finance/budget-2011-12-income-tax-ratenews-economy-lc2nEcieiia.bmradvisors.moneycontrol.php?pg=5 http://www.com/budget-analysis-2011/taxamendments.sify.gov.org/2011/03/highlights-of-union-budget2011-indirect-taxes.