Nirmala Sitharaman rolls back surcharge on FPIs and domestic investors, announces measures to boost economy

FP Staff August 23, 2019 18:51:00 IST
Nirmala Sitharaman rolls back surcharge on FPIs and domestic investors, announces measures to boost economy
  • Nirmala Sitharaman announced a slew of measures from ease of doing business to faceless scrutiny of tax returns for startups at a press conference on Friday

  • Echoing Narendra Modi's Independence Day speech talking of respect for wealth creators, she said this was the spirt of her budget for FY20

  • She also reiterated that reform was on top of the government's agenda and that the reform process will continue

Finance Minister Nirmala Sitharaman announced a slew of measure,  from ease of doing business to faceless scrutiny of tax returns, for startups in a press conference on Friday evening.

Echoing Prime Minister Narendra Modi's Independence Day speech talking of respect for wealth creators, she said this was the spirt of her budget for FY20.

Seeking to dispel doubts over the economy and government's growth agenda, Sitharaman said India's GDP continues to grow at a faster pace than the global economy and any other major economy.

Global GDP growth may be revised downwards from the current estimate of 3.2 percent, she said adding that globally the demand was going to be weak. But the Indian economy was growing faster than the global average and all other major economies, Sitharaman added.

As a result of US-China trade war and currency devaluation, very volatile situation has developed in global trade, she said.

Sitharaman said the government hasn't lost its momentum with regard to reforms. Reform is on top of the government's agenda and the reform process will continue, she reiterated.

Some of the key steps Sitharaman spelt out include:

Corporate Social Responsibility (CSR) : It will be treated as a civil matter and not as a criminal matter, the Finance Minister said, providing a much-needed relief to corporates. The intention of the government is to go down the prosecution route, she aid. The Ministry of Corporate Affairs (MCA_ will review section in Companies act on CSR violations, she clarified.

Income Tax: Issues related to income tax, letters, and notifications will be issued by a centralised computerised system to end harassment of taxpayers. "There will be no one authority or officer who will do this on his own. All notices will be disposed off within three months of date of reply. No assessee will have anything to do after he/she gives the reply,"said Sitharaman. All old tax notices will be decided by 1 October or will be uploaded again through the centralised system, she said.

Long-term, short-term capital gains: With regard to taxation measures, Sitharaman said, enhanced surcharge on FPIs and domestic investors was withdrawn, restoring pre-Budget position.

Startups: To mitigate genuine difficulties of startups, Income Tax Act shall not be applicable to a startup registered with DPIIP. Section that is invoked and through which startups had difficulty will continue but will not apply to registered startups. There will be a dedicated cell for redressal of issues, she said.

GST refunds: All pending GST refunds, due to small and medium enterprises (SMEs), will be paid in 30 days. The refunds will be processed in 30 days irrespective of their pending timeline. Not only this, all future GST refunds will be settled in 60 days for SMEs, so that small businesses do not have to worry about their money being stuck somewhere, said Sitharaman. All pending GST refunds due to MSMEs will be paid within 30 days from today, she said. All the GST refunds in future will be resolved in 60 days from the day they arise.

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