Indirect Tax changes proposed by Union Budget 2024

The Budget 2024 i.e. Interim Budget presented by Finance Minister Nirmala Sitharaman in the parliament today. Some changes have been proposed in Indirect Taxes.

Indirect Tax changes

Reetu | Feb 1, 2024 |

Indirect Tax changes proposed by Union Budget 2024

Indirect Tax changes proposed by Union Budget 2024

The Budget 2024 i.e. Interim Budget presented by Finance Minister Nirmala Sitharaman in the parliament today. This is the final budget of Prime Minister Narendra Modi’s second term, ahead of the Lok Sabha elections in 2024. The complete budget for the financial year 2024-25 will not be issued until the next government is formed following the general elections.

Before the Budget, there was a lot of speculation; businessmen, finance professionals, and others had varying expectations for this interim budget. Several ideas were given to the government for consideration and implementation.

Some changes have been proposed in Indirect Taxes by the Finance Minister in the Union Budget 2024.

No Major changes have been proposed in Indirect Tax in Budget 2024:

  • FM proposes to retain the same tax rates for indirect taxes and import duties.
  • GST unified the highly fragmented indirect tax regime in India.
    • Average monthly gross GST collection doubled to Rs 1.66 lakh crore this year.
    • The GST tax base has doubled.
    • State SGST revenue buoyancy (including compensation released to states) increased to 1.22 in the post-GST period(2017-18 to 2022-23) from 0.72 in the pre-GST period (2012-13 to 2015-16) 94% of industry leaders view the transition to GST as largely positive.
    • GST led to supply chain optimization.
    • GST reduced the compliance burden on trade and industry.
    • Lower logistics costs and taxes helped reduce prices of goods and services, benefiting the consumers.

2 changes proposed by the Interim Budget 2024

  • Definition of Input Service Distributor has been amended in GST Law to make ISD registration compulsory if office of supplier of goods or services receives tax invoices towards receipt of input services for or on behalf of Distinct Persons. With amendment in definition of ISD, manner of distribution of credit has also been modified.
  • New section 122A has been introduced for applicability of Penalty for failure to register certain machines used in manufacture of goods as per special procedure (Tobacco Industry).

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