1 February 2019
Budget Connect 2019 Tax Alert – Budget impact
Direct tax proposals in Union Budget 2019 On 1 February 2019, the Finance Minister presented the Interim Budget for 2019-20 in the Parliament. This Tax Alert provides the key highlights of the Interim Budget. In keeping with the convention while presenting an interim budget in an election year, there are no major amendments proposed to the direct tax laws. There are no proposed changes to tax bands or rates for individual taxpayers. For domestic companies, for lower basic tax rate of 25% in financial year (FY) 2019-20, the base year for turnover less than INR 2500m is shifted ahead by one year to FY 2017-18. There are, however, some proposals which will apply from FY 2019-20 which the Government has introduced by deviating from the past convention of not announcing major tax proposals in the Interim Budget. These proposals include enhancement of standard deduction for salaried taxpayers, higher tax rebate for individuals, nil annual value for two self-occupied house properties, one-time long term capital gains rollover benefit for investment in two residential houses, higher withholding tax thresholds for interest and rent to resident taxpayers, extension of profit-linked deduction for affordable housing projects to projects approved till 31 March 2020 and also an extended period of two years for benefit of nil annual value for vacant unsold house property held as stock-in-trade.
Budget Connect 2019