Indian Union Budget 2023-24

The Union Budget 2023 successfully addressed all segments of society with fiscal prudence. The Indian Finance Minister – Nirmala Sitharaman - accentuated the Government's ambitious plans to achieve a fiscal deficit of 6.4% of the GDP in the Financial Year 2023.

Moreover, the budget offered relief to individual middle-class taxpayers and simultaneously delivered a strong thrust on capital expenditure of INR 10 trillion to accelerate the country's growth gear and equip the nation with better supply chains while building long-term assets and creating an investor-friendly environment.

From a Direct Taxation Angle

• No tax on income upto INR 7 lakhs
• Receipt on surrender/maturity of life insurance policy with an aggregate premium above INR 5 lakhs will be taxable.
• 15% concessional tax rate has been extended to new manufacturing Cooperative societies, subject to conditions.
• For MSMEs/Small Businesses, the turnover presumptive taxation limit revised from INR 20 million to 30 million.
• Extension of the Angel Tax to Non-Resident Funding.
• Time limit to submit the Transfer Pricing report has been reduced to 10 days from 30 days.

From an Indirect Taxation Angle

• Scope and Coverage of Online Information and Database Retrieval (OIDAR), enhanced significantly; thus, service providers.
• supplying services electronically in the future will require GST registration and pay taxes.
• GSTR 1, GSTR 3B, GSTR 9, and GSTR 8 cannot be filed three years after the due date.
• Rationalization of Basic Customs Duty rates from 21 to 13 rates.
• No way forward on the Development of Enterprise and Service Hubs (DESH) scheme and GST Tribunals.
• Supply of Warehoused Goods before clearance for home consumption - considered as exempt supply.
• ITC of expenditure incurred towards CSR activities disallowed