Interim Budget 2024 Highlights.

Given the interim nature of the budget ahead of the general elections later this year, focus was on continuity of existing Government policies to a large extent, with a vision for inclusive growth and prosperity. We wish to share some of the key tax and policy highlights as announced in the Budget: 

·       Continued focus on transport infrastructure development and modernisation, including expansion of metro network, railway corridors and development of new airports;

·       Impetus to technological advancement with corpus of INR 100,000 crore for long-term financing and interest free loan for research and innovation in sunrise sectors and new schemes for deep-tech technologies for self-reliance in defence sector;

·       Green growth with measures introduced for net-zero by 2070 including viability gap funding for offshore wind energy, strengthening e-vehicle ecosystem and adoption of e-buses;

 

Also, please find below the key amendments from a direct tax perspective, for your quick reference:

 

·       Extension of sunset date from 31 March 2024 to 31 March 2025 for claim of exemption in respect of the following:

 

Section	Applicable to	Exemption	Sunset clause
10(4D)	Investment division of non-resident IFSC Banking Unit (“IBU”)	Income from foreign securities, capital gains from Indian securities (other than equity shares), capital gains from securities listed on IFSC exchanges, business income from securitisation trust	The sunset clause for commencement of investment operations by such IBUs has been extended to 31 March 2025
10(23FE)	Abu Dhabi Investment Authority, Sovereign Wealth Funds, Pension Funds (satisfying prescribed conditions)	Dividend, interest, income from units of a business trust, long term capital gains arising from investment in debt, shares or units in India	The sunset clause for making the investment in debt, shares or units in India has been extended to 31 March 2025
80-IAC	Eligible start-ups	100% deduction of profits and gains derived from eligible business	The deadline for incorporation has been extended to 31 March 2025

 

·       The time limit for issuance of notification for faceless proceedings for transfer pricing assessment, faceless proceedings before Dispute Resolution Panel and faceless appeal proceedings before Tribunal is extended from 31 March 2024 to 31 March 2025.

 

·       Withdrawal of tax demands up to INR 10,000 for financial years 2010-11 to 2014-15 and up to INR 25,000 for prior tax years pertaining to the period up to financial year 2009-10.

 

·       The recent changes in TCS on LRS remittances and foreign tour packages announced in various press releases, have been incorporated in Legislative section 206C(1G), through amendments in the existing language of this section. There is no reduction in TCS from 20% to 5%.

 

·       No changes in Tax Regime both in Income Tax and GST.

 

·        The threshold time limit for the benefit of reduced corporate tax rate u/s 115BAB of 15% plus surcharge, in case of a newly setup manufacturing Companies up to 31.3.2024, has unfortunately not been extended further. So new manufacturing Companies which are incorporated on or after 1.4.2024 will be taxed at 22% and not 15%, if they opt for the new regime

 

·       ISD under GST is now mandatory.