Finance Minister Mr. Pranab Mukherjee presented finance bill 2012 and he made some amendments in the finance bill 2012 which are as follows.
1- GARR (General anti-avoidance rule) has been deferred for a year and it will be implement in the next financial year April 2013.
2- DTAA (Double tax avoidance agreement) which India has with many countries will not override with GAAR.
3- GARR will impact where such transactions are made with low tax or the countries with which India doesn’t have the DTAA agreement.
4- Investors needn’t to prove the status of their compliance with tax laws.
5- For private equity funds, the tax rate is reduced 10 per cent from 20 per cent.
6- For PE funds, LTCG tax will be treated as same as FIIs.
7- For unlisted securities, the STT (securities transaction tax) will be levied at 2%.
8- There is an extension of exemption on long term capital gain on sale of unlisted securities in an IPO.
9- In the speech, Mr. Mukherjee has proposed to withdraw the excise duty of 1% on precious metal and jewellery with effect from 17 March 2012.
10- Business which have foreign borrowings need to pay lower withholding tax at the rate of 5%.
11- The finance bill 2012 also withdraws the TDS of 1% on sale of immovable property.
12- In this finance bill, it is also proposed to raise the limit of Tax collection at source (TCS) on cash purchase of jewellery to 5 lakh. Earlier the limit was 2%.
Read full speech of finance bill from here
