ICAI Submits Post Budget 2019 Memorandum on Direct Taxes (including International Taxation) to Govt.
ICAI has submitted Post Budget Memorandum 2019 on Direct Taxes (including International Taxation) containing various detailed suggestions to Ministry of Finance, Govt. of India, regarding tax proposals of Budget 2019 for the financial year 2019-20.
1. Clause 25 – Proposed section 80EEA – Tax incentive for affordable housing – Certain concerns to be addressed:
Issue I: Request to provide benefit to assessees whose loan were sanctioned after section 80EE deduction was not available i.e. 01.04.2017 and onwards
Issue II: Clarity regarding benefit to be available for loan taken for construction of residential house property as well Issue III: Request to raise the value of residential house property from Rs 45 lakhs to a reasonable amount so that additional deduction of Rs 1.5 lakh may be claimed.
Issue IV: Condition of not owning any residential house not in line with the provisions of section 54 and 23.
2. Clause 25 – Proposed section 80EEB – Tax incentive for electric vehicles/Deduction in respect of purchase of electric vehicle – Inadvertent error pertaining to condition of owning no electric vehicle may be inserted in the Finance (No. 2) Bill, 2019.
3. Clause 36 – Section 115QA – Tax on income distributed to shareholder in case of listed companies – Practical difficulties to be faced by listed companies for calculation of proposed tax/distributed income
Issue I-Need for notification of new rules or amendment in existing rule 40BB
Issue II: Concern of listed companies who announced the buyback before 05.07.2019 but not completed buyback by that date
4. Clause 39(b) – Proposed seventh proviso to section 139(1) – Mandatory furnishing of return of income – Deposit amount exceeding one crore rupees in current account may be made applicable to all types of accounts
Issue I: Scope to be enlarged date
Issue II: The term ‘expenditure’ may be replaced with term ‘payment’
5. Clause 44 – Section 194DA – TDS on non exempt portion of life insurance pay-out on net basis – Concerns w.r.t. terms used like ‘income’ and ‘therein’
6. Clause 46 – Section 194N – Practical difficulties to be faced and clarifications required regarding implementation of proposed provision of TDS @ 2% on cash withdrawals exceeding Rs 1,00,00,000
Issue I: Minor inconsistency between budget speech and Finance Bill
Issue II: Need to make consequential amendments/ clarifications w.r.t. claiming of credit of TDS matching with income offered for tax
Issue III: Term ‘recipient’ may not convey the right meaning
7. Clause 65 – Section 276CC – Proposed amendment w.r.t. clarification regarding inclusion of amount of advance tax paid and tax collected at source may be made applicable with retrospective effect.