Unveiling India’s economic pulse! A glimpse into demands and expectations from key sectors

The interim budget will be voted on account so we might not see any major announcements from the Finance Minister. However, we might see some announcements towards ease of doing business. With GST collections showing healthy growth, the Government can consider enhancing the threshold for GST registration to 40 lacs which currently is at 20 lacs. Further, while the GST council had proposed to make ISD mandatory for the distribution of credit, so we might see changes in GST legislation related to that. Further, on the customs front, there is a dire need to digitalize the process to verify the certificate of origin under FTA / PTA which will save time and effort for importers claiming benefits under FTAs / PTAs. – Ankur Gupta

Rationalisation of withholding tax rate for payment to Non-residents towards Royalty & fees for technical services. The rate of withholding tax was increased from 10% to 20%, however, considering that these are common services that Indian companies receive from non-resident service providers and often the non-residents expect the withholding tax to be borne by the payer, it becomes an additional burden on the Indian payers.

Push for streamlining Advance Pricing Agreements. At present such agreements have a long gestation period and due to this the push for adopting them as an alternative becomes less attractive. Therefore, a time-bound process can be incorporated so that this becomes a preferred alternative to reduce transfer pricing litigation

Extension for timelines to opt for beneficial tax rate provisions by manufacturing companies. The present timeline to commence manufacturing ends on 31st March 2024, which should be extended for the companies so that the beneficial corporate tax rate of 15% is available to be opted for.

Provide tax incentives to companies who adopt AI tools from local software companies in India. This will help in promoting local AI development and increase the reach of technology – Saurrav Sood

Link – https://www.financialexpress.com/budget/budget-2024-expectations-live-updates-nirmala-sitharaman-interim-budget-income-tax-slabs-itr-infrastructure-railways-healthcare-auto-3374456/