New Delhi: The Union Budget 2025 introduces significant tax reforms aimed at improving ease of doing business in New Delhi and across India. Key changes include expanding safe harbour rules, simplifying international transaction pricing, reducing compliance burdens for small trusts, and extending the time limit for updated IT returns.
Indirect tax measures focus on trade facilitation, providing extended time for the end-use of imported inputs and incentivizing voluntary compliance. The budget also offers tax exemptions on National Savings Scheme withdrawals.
Tax reforms to improve ease of doing business:
- Scheme to be introduced for determining arm’s length price of international transaction for a block period of three years.
- Scope of safe harbour rules to be expanded, to reduce litigation and provide certainty in international taxation.
- Tax exemption to be provided on withdrawals made from National Savings Scheme by individuals on or after 29th August, 2024.
Reducing burden of tax compliance
- Compliance burden for small charitable trusts & institutions to be reduced, by increasing their registration period from 5 years to 10 years.
- Taxpayers to be allowed to claim annual value of two self-occupied properties as nil without any condition.
- Time-limit to file updated IT returns for any assessment year, to be increased from two years to four years.
Indirect Tax Measures for Trade Facilitation
- Time-limit of two years to be fixed, extendable by a year, for finalizing provisional assessment under the Customs Act.
- Incentivizing Voluntary Compliance: New provision to be introduced which will enable importers or exporters, after clearance of goods, to voluntarily declare material facts and pay duty with interest but without penalty.
- Extended Time for End Use: Time limit for end-use of imported inputs to be extended from six months to one year, to provide operational flexibility; such importers will now have to file only quarterly statements instead of monthly statements.
Budget 2025 Announcements by FM Nirmala Sitharaman: Key changes include expanding safe harbour rules, simplifying international transaction pricing, reducing compliance burdens for small trusts, and extending the time limit for updated IT returns. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
