Lawyer Monthly Magazine - March 2020 Edition

On 1 February 2020 the Finance Minister presented the Union Budget for the financial year 2020-21. The budget for FY 2020-21 is woven around three prominent themes that are - (a) aspirational India (b) economic development, and (c) a caring society. During her speech, the Finance Minister stated that it is the Government’s intention to make India a five trillion dollar economy by 2024. Towards this end, the Government proposed a number of reforms with a strong focus on investment in infrastructure development, digital economyandemployment generation inmediumandsmall enterprises by stimulating growth, promoting digitisation, transparency and simplifying tax administration. We have set out below the key announcements made during the budget speech. UPDATE ON THE BUDGET 2020-2021 Regulatory Update of the Month By Clasis Law 22 WWW.LAWYER-MONTHLY.COM | MAR 2020 Regulatory: • Proposal to remove criminal liability for acts which are civil in nature from various laws including the Companies Act, 2013; • Proposal to issue a policy enabling the private sector to build Data Centre parks across the country; • Proposal to introduce a new National Policy on Official Statistics to improve data collection and dissemination with the help of latest technology including artificial intelligence; • Aadhaar-based verification of taxpayers is being introduced to weed out dummy or non-existent units. Further, a proposal to allot an instant online permanent account number (PAN) on the basis of Aadhaar; • Unique registration number (URN) to be issued to all new and existing charity institutions; • Registration of charity institutions to be made completely electronic. Donations made by a taxpayer to be pre-filled in the income tax return form to claim exemptions for donations easily; and • Investment Clearance Cell proposed to be set up to provide “end to end” facilitation and support and to work through a portal. Corporate commercial: • Extending the benefit of carrying forward of business losses and unabsorbed depreciation to the amalgamation of nationalized public sector banks and general insurance companies; • Proposal to reduce tax on cooperative societies to 22% plus surcharge and cess, from 30% at present; • Dividend Distribution Tax (DDT) abolished. Dividend income from shares and mutual funds will now be taxable in the hands of the shareholder/ recipient at applicable income tax rates; • New section inserted for tax withholding at 1% Finance Minister, Nirmala Sitharaman - (DoD photo by Lisa Ferdinando)