Additional Resource Mobilization for agriculture, rural economy and clean environment

While presenting the General Budget 2016-17 in Lok Sabha today, the Union Finance Minister Shri Arun Jaitley said that uniform application of Dividend Distribution Tax (DDT) to all investors distorts the fairness and progressive nature of taxes. He therefore proposed that in addition to DDT paid by the companies, tax at the rate of 10% of gross amount of dividend will be payable by the recipients, that is, individuals, HUFs and firms receiving dividend in excess of Rs. 10 lakh per annum.

The surcharge was increased from 12% to 15% on persons having income above Rs. 1 crore. The rate of Securities Transaction tax in case of 'options' was increased from 0.017% to 0.05%.

In order to tap tax on income accruing to foreign e-commerce companies from India, it was proposed that a person making payment to a non-resident, who does not have a permanent establishment, exceeding in aggregate Rs. 1 lakh in a year, as consideration for online advertisement, will withhold tax at 6% of gross amount paid, as Equalization levy. This levy will apply only on B2B transactions.

It was also proposed to collect tax at source at the rate of 1% on purchase of luxury cars exceeding value of Rs. 10 lakh and purchase of goods and services in cash exceeding Rs. 2 lakh.

Source : Equity Bulls

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