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With the objective of ease of doing business and in line with recent Goods and Services Tax (GST) council recommendations, various proposals have been introduced under GST. Key GST proposals include relaxation in time limit for availing input tax credit pertaining to first four years of GST regime till November 30, 2021; exclusion of un-denatured extra neutral alcohol or rectified spirit used for manufacture of alcoholic liquor for human consumption from GST levy; empowerment of the Government to regularise non-levy or short levy of GST due to general trade practice and to notify date of filing of appeal before appellate tribunal w.e.f. August 1, 2024.
On GST litigation framework standpoint, the Government has proposed unified provisions for timeline i.e 42 months for issuing notice, replacing the current dual timelines categorised on the basis of reasons for contravention. The budget has also proposed conditional waiver of interest and penalty demand pertaining to first three years of the GST regime, reduction in maximum pre-deposit amount for filing appeal applications and empowerment for notifying GST appellate tribunals for anti-profiteering cases. Amidst vast expectations from the insurance sector and industry representations, the Government has also proposed to include co-insurance premium apportionments and re-insurance commissions with prescribed conditions to be outside GST ambit.
In the Customs arena, the Narendra Modi-led government has announced several Customs duty initiatives targeting diverse goods to encourage domestic manufacturing, enhance local value addition, promote export competitiveness and simplify taxation. Granting custom duty exemptions on cancer medicines, critical minerals as well as specific goods essential for manufacturing in solar energy and marine industry, underscores the Government’s commitment to inclusive development. Additionally, industries such as electronics, leather, textile, jewellery and telecommunication have also benefited from relaxed custom duties. Other trade facilitation measures include extension in timelines for export of goods imported for repairs and re-import of goods for repairs under warranty.
Albeit the industry’s persistent indirect tax expectations including broadening the scope of Production Linked Incentive schemes, inclusion of petroleum products under GST, etc. and resolving contentious issues being pivotal for stakeholders remained unaddressed. While the Union budget did not explicitly tackle these demands, one may anticipate subsequent announcements as the year unfolds.
This budget’s optimistic approach establishes the foundation for strategic fiscal allocations and policy interventions aimed at strengthening pivotal sectors driving sustainable economic growth. With a robust focus on accelerating growth, fostering inclusivity and embracing sustainable development, the budget sets forth a comprehensive journey towards achieving the goal of ‘Viksit Bharat’.
Disclaimer: Krishan Arora is Partner, Karan Kakkar is Partner, and Devika Dixit is Director at Grant Thornton Bharat LLP
Contributed by: Vasu Aggarwal (Manager) and Raghav Gupta (Assistant Manager) at Grant Thornton Bharat LLP
First Published: Jul 24 2024 | 9:36 AM IST
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