Summary of the budget speech

Sec. 206AA to be amended, instead of PAN, foreign tax registration sufficient
Limited period compliance window for domestic taxpayers to declare past transgressions at total 45% tax (including interest & penalty)
POEM deferred by 1 year
No deferral of GAAR, to kick in from April 2017
Entire scheme of penalty revisited. Different penalty rate for different classes of mis-demeanors. Minimum penalty rate brought down to 50%.
Retro panel committee to be headed by Revenue Secy
One time scheme for cases pursuant to retro panel – Drop litigation, drop arbitration. Pay tax arrears, Interest & penalty to be waived.
Rule 8D formula rationalised.
Proposes to rationalise TDS provisions for smaller taxpayers.
E-assessments for all taxpayers in 7 mega cities
Propose to accept large no. of recommendations of Justice Easwar committee in this budget.
Sunset date for SEZ tax incentives – 2020
In addition to DDT, 10% dividend tax in hands of recipient on dividend income above Rs. 10 lacs
New dispute resolution mechanism announced, offer extended to taxpayers to settle disputes.
Tax incentive for cos engaged in affordable housing construction
WHT introduced on e-commerce advertisements; 6% equalization levy on b2b transactions on online advts
Country by country reporting guidelines introduced
Long term capital gains on shares – holding period for unlisted companies to be reduced from 3 yrs to 2 yrs
Presumptive taxation scheme turnover limit increased to Rs. 2cr.
For Professionals, presumptive taxation scheme turnover limit at Rs. 50 lacs
Accelerated depreciation to be limited to 40% from Apr 2017
Benefit of weighted R&D to be limited to 150% & then 100%
Weighted deduction u/s 35CCD to continue till 2020
New manufacturing cos. incorporated after Apr 2016, to be taxed at 25%
Smaller cos with turnover below 5cr to be taxed at 29% tax
For start-ups, 3 year tax holiday if incorporated between 2016 – 2019 but MAT to apply
Indian Patent box – 10% tax rate on income from specified patent exploitation
NPS – Withdrawal of 40% at the time of retirement exempt
First home buyers – additional interest deduction of Rs 50k
REIT taxation rationalised on dividend distribution by SPVs
Additional Rs 50,000 interest deduction for first time home buyers, for house cost upto Rs. 50 lacs
Luxury tax on cars costing above 10 lacs
Minor increase in STT for Options
CENVAT credit rules to be rationalised.
13 different cesses to be abolished

Revenue loss of Rs 1,000 cr due to direct tax proposals. Revenue gain of Rs. 20,000 cr on account of indirect tax proposals