3 min read.Updated: 01 Feb 2021, 02:07 PM IST Edited By Sanchari Ghosh
MD and CEO of Edelweiss Mutual Fund said: This was unequivocally a good budget - focused on short term growth in the right areas, without disruptive taxation
She also said: Thank you to the budget for bringing much-needed tax parity between MFs and other financial products
Moments after Union Finance Minister Nirmala Sitharaman concluded her third budget, Radhika Gupta, MD and CEO of Edelweiss Mutual Fund calls it unequivocally a good budget and adding the importance of implementing it in the right manner.
She took to Twitter to say: This was unequivocally a good budget - focused on short term growth in the right areas, without disruptive taxation. A thoughtful one, for extraordinary times. The magic is in execution now.
Amidst a pandemic and an economic crisis, Nirmala Sitharaman presented a budget that is focused on boosting spending on job creation and rural development, generous allocations for development schemes, putting more money in the hands of the average taxpayer and easing rules to attract foreign investments.
Gupta had earlier expressed her apprehension regarding tax rule changes in the Budget. She had tweeted earlier, what I don’t want from the budget: a change in tax rules that is ambiguous in interpretation, and creates chaos. Think GAAR and the FPI saga. India needs a consistent and stable tax regime.
What I don’t want from the budget: a change in tax rules that is ambiguous in interpretation, and creates chaos. Think GAAR and the FPI saga. India needs a consistent and stable tax regime.
In last year's Budget, Finance Minister Nirmala Sitharaman introduced a new income tax regime. Though choosing the income tax regime, old or new, is optional but it left the taxpayer baffled. Thankfully, not many changes were made in the tax policy this year.
Changes in the tax rules
Senior citizens above 75 years of age with only pension and interest incomes have been exempted from filing tax returns, Finance Minister Nirmala Sitharaman announced on Monday.
While tabling the Union budget 2021-22 in Parliament, the minister said that the number of income tax return filers has increased to 6.48 crores now from 3.48 crores in 2014.
"We shall reduce the compliance burden on our senior citizens who are 75 years of age and above. For senior citizens who have pensions and interest income, I propose exemption from filing their income tax returns. The paying bank will deduct the necessary tax from their income," she said.
Sitharaman said serious tax offences of concealment of income of over ₹50 lakh can be reopened even after 10 years.
"Presently an assessment can be reopened up to six years and in serious tax fraud cases up to 10 years, as a result, taxpayers have to remain under uncertainty for a long time. I, therefore, propose to reduce this time limit for reopening of assessments to three years from the present six years. In serious tax evasion cases too, only where there is evidence of concealment of income of ₹50 lakh or more in a year can the assessment be reopened up to 10 years. Even this reopening can be done only after the approval of the principal chief commissioner, the highest level of the income tax department," she said.
The Finance Minister also announced to constitute a dispute resolution for small taxpayers that will be faceless to ensure efficiency, transparency and accountability. Anyone with a taxable income up to ₹50 lakhs and disputed income up to ₹10 lakhs shall be eligible to approach the committee, she said.
She also proposed to make income tax appellate tribunals faceless and to set up national income tax appellate tribunal centre.
"I propose to make Income Tax Appellate Tribunal faceless. We shall establish a national faceless income tax appellate Tribunal centre. All communication between Tribunal and the appellant shall be electronic, where personal hearing is needed, it shall be done through video conferencing," the minister said.
Sitharaman said that exemption from tax audit limit doubled to ₹10 crores turnover for companies doing most of their business through digital modes.
"Currently, if your turnover exceeds ₹1 crores, you have to get your accounts audited. In February 2020 budget, I had increased the limit for taxation audits to ₹5 crores for those who carry out 95 per cent of their transactions digitally. To further incentivise digital transactions and to reduce compliance burden, I propose to increase this limit for tax audit for such persons from five crores to ₹10 crores," she said.